Correlation Between Project Planning and Thai Oil
Can any of the company-specific risk be diversified away by investing in both Project Planning and Thai Oil at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Project Planning and Thai Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Project Planning Service and Thai Oil Public, you can compare the effects of market volatilities on Project Planning and Thai Oil and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Project Planning with a short position of Thai Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Project Planning and Thai Oil.
Diversification Opportunities for Project Planning and Thai Oil
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Project and Thai is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Project Planning Service and Thai Oil Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Oil Public and Project Planning is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Project Planning Service are associated (or correlated) with Thai Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Oil Public has no effect on the direction of Project Planning i.e., Project Planning and Thai Oil go up and down completely randomly.
Pair Corralation between Project Planning and Thai Oil
Assuming the 90 days trading horizon Project Planning is expected to generate 2.06 times less return on investment than Thai Oil. But when comparing it to its historical volatility, Project Planning Service is 1.41 times less risky than Thai Oil. It trades about 0.08 of its potential returns per unit of risk. Thai Oil Public is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 4,625 in Thai Oil Public on September 3, 2024 and sell it today you would lose (875.00) from holding Thai Oil Public or give up 18.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Project Planning Service vs. Thai Oil Public
Performance |
| Timeline |
| Project Planning Service |
| Thai Oil Public |
Project Planning and Thai Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Project Planning and Thai Oil
The main advantage of trading using opposite Project Planning and Thai Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Project Planning position performs unexpectedly, Thai Oil can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Thai Oil will offset losses from the drop in Thai Oil's long position.| Project Planning vs. Power Solution Technologies | Project Planning vs. Kingsmen CMTI Public | Project Planning vs. Panjawattana Plastic Public | Project Planning vs. Cho Thavee Public |
| Thai Oil vs. PTT Oil and | Thai Oil vs. Thai Oil Public | Thai Oil vs. IRPC Public | Thai Oil vs. Star Petroleum Refining |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Commodity Directory module to find actively traded commodities issued by global exchanges.
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