Correlation Between Sena Development and Thai Life
Can any of the company-specific risk be diversified away by investing in both Sena Development and Thai Life 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 Sena Development and Thai Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sena Development Public and Thai Life Insurance, you can compare the effects of market volatilities on Sena Development and Thai Life 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 Sena Development with a short position of Thai Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sena Development and Thai Life.
Diversification Opportunities for Sena Development and Thai Life
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sena and Thai is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Sena Development Public and Thai Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Life Insurance and Sena Development 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 Sena Development Public are associated (or correlated) with Thai Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Life Insurance has no effect on the direction of Sena Development i.e., Sena Development and Thai Life go up and down completely randomly.
Pair Corralation between Sena Development and Thai Life
Assuming the 90 days trading horizon Sena Development Public is expected to generate 23.06 times more return on investment than Thai Life. However, Sena Development is 23.06 times more volatile than Thai Life Insurance. It trades about 0.04 of its potential returns per unit of risk. Thai Life Insurance is currently generating about -0.02 per unit of risk. If you would invest 355.00 in Sena Development Public on September 3, 2024 and sell it today you would lose (131.00) from holding Sena Development Public or give up 36.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sena Development Public vs. Thai Life Insurance
Performance |
| Timeline |
| Sena Development Public |
| Thai Life Insurance |
Sena Development and Thai Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sena Development and Thai Life
The main advantage of trading using opposite Sena Development and Thai Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sena Development position performs unexpectedly, Thai Life 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 Life will offset losses from the drop in Thai Life's long position.| Sena Development vs. KTBST Mixed Leasehold | Sena Development vs. Bhiraj Office Leasehold | Sena Development vs. Warrix Sport PCL | Sena Development vs. Interlink Telecom Public |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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