Correlation Between Thaitheparos Public and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Thaitheparos Public and Dow Jones 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 Thaitheparos Public and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thaitheparos Public and Dow Jones Industrial, you can compare the effects of market volatilities on Thaitheparos Public and Dow Jones 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 Thaitheparos Public with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thaitheparos Public and Dow Jones.
Diversification Opportunities for Thaitheparos Public and Dow Jones
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Thaitheparos and Dow is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Thaitheparos Public and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Thaitheparos Public 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 Thaitheparos Public are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Thaitheparos Public i.e., Thaitheparos Public and Dow Jones go up and down completely randomly.
Pair Corralation between Thaitheparos Public and Dow Jones
Assuming the 90 days trading horizon Thaitheparos Public is expected to generate 111.25 times more return on investment than Dow Jones. However, Thaitheparos Public is 111.25 times more volatile than Dow Jones Industrial. It trades about 0.07 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.14 per unit of risk. If you would invest 4,100 in Thaitheparos Public on September 3, 2024 and sell it today you would lose (175.00) from holding Thaitheparos Public or give up 4.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.95% |
| Values | Daily Returns |
Thaitheparos Public vs. Dow Jones Industrial
Performance |
| Timeline |
Thaitheparos Public and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Thaitheparos Public
Pair trading matchups for Thaitheparos Public
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Thaitheparos Public and Dow Jones
The main advantage of trading using opposite Thaitheparos Public and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thaitheparos Public position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Thaitheparos Public vs. Airports of Thailand | Thaitheparos Public vs. PTT Public | Thaitheparos Public vs. Bangkok Dusit Medical | Thaitheparos Public vs. Kasikornbank Public |
| Dow Jones vs. Eastern Co | Dow Jones vs. Uber Technologies | Dow Jones vs. AKITA Drilling | Dow Jones vs. Chemours Co |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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