Correlation Between Premier Technology and Trinity Watthana
Can any of the company-specific risk be diversified away by investing in both Premier Technology and Trinity Watthana 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 Premier Technology and Trinity Watthana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Premier Technology Public and Trinity Watthana Public, you can compare the effects of market volatilities on Premier Technology and Trinity Watthana 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 Premier Technology with a short position of Trinity Watthana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Premier Technology and Trinity Watthana.
Diversification Opportunities for Premier Technology and Trinity Watthana
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Premier and Trinity is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Premier Technology Public and Trinity Watthana Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trinity Watthana Public and Premier Technology 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 Premier Technology Public are associated (or correlated) with Trinity Watthana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trinity Watthana Public has no effect on the direction of Premier Technology i.e., Premier Technology and Trinity Watthana go up and down completely randomly.
Pair Corralation between Premier Technology and Trinity Watthana
Assuming the 90 days horizon Premier Technology is expected to generate 8.7 times less return on investment than Trinity Watthana. But when comparing it to its historical volatility, Premier Technology Public is 3.23 times less risky than Trinity Watthana. It trades about 0.12 of its potential returns per unit of risk. Trinity Watthana Public is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 368.00 in Trinity Watthana Public on August 27, 2024 and sell it today you would earn a total of 72.00 from holding Trinity Watthana Public or generate 19.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Premier Technology Public vs. Trinity Watthana Public
Performance |
| Timeline |
| Premier Technology Public |
| Trinity Watthana Public |
Premier Technology and Trinity Watthana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Premier Technology and Trinity Watthana
The main advantage of trading using opposite Premier Technology and Trinity Watthana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Premier Technology position performs unexpectedly, Trinity Watthana 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 Trinity Watthana will offset losses from the drop in Trinity Watthana's long position.| Premier Technology vs. AP Public | Premier Technology vs. Jasmine International Public | Premier Technology vs. Asia Plus Group | Premier Technology vs. Bangkok Aviation Fuel |
| Trinity Watthana vs. Thai Energy Storage | Trinity Watthana vs. Royal Orchid Hotel | Trinity Watthana vs. Grand Canal Land | Trinity Watthana vs. PRG Public |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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