Correlation Between Stock Exchange and Thai Rubber
Can any of the company-specific risk be diversified away by investing in both Stock Exchange and Thai Rubber 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 Stock Exchange and Thai Rubber into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stock Exchange Of and Thai Rubber Latex, you can compare the effects of market volatilities on Stock Exchange and Thai Rubber 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 Stock Exchange with a short position of Thai Rubber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stock Exchange and Thai Rubber.
Diversification Opportunities for Stock Exchange and Thai Rubber
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Stock and Thai is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Stock Exchange Of and Thai Rubber Latex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Rubber Latex and Stock Exchange 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 Stock Exchange Of are associated (or correlated) with Thai Rubber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Rubber Latex has no effect on the direction of Stock Exchange i.e., Stock Exchange and Thai Rubber go up and down completely randomly.
Pair Corralation between Stock Exchange and Thai Rubber
Assuming the 90 days trading horizon Stock Exchange Of is expected to generate 0.23 times more return on investment than Thai Rubber. However, Stock Exchange Of is 4.39 times less risky than Thai Rubber. It trades about -0.02 of its potential returns per unit of risk. Thai Rubber Latex is currently generating about -0.04 per unit of risk. If you would invest 156,225 in Stock Exchange Of on August 26, 2024 and sell it today you would lose (11,595) from holding Stock Exchange Of or give up 7.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stock Exchange Of vs. Thai Rubber Latex
Performance |
| Timeline |
Stock Exchange and Thai Rubber Volatility Contrast
Predicted Return Density |
| Returns |
Stock Exchange Of
Pair trading matchups for Stock Exchange
Thai Rubber Latex
Pair trading matchups for Thai Rubber
Pair Trading with Stock Exchange and Thai Rubber
The main advantage of trading using opposite Stock Exchange and Thai Rubber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stock Exchange position performs unexpectedly, Thai Rubber 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 Rubber will offset losses from the drop in Thai Rubber's long position.| Stock Exchange vs. Bank of Ayudhya | Stock Exchange vs. ABSOLUTE CLEAN ENERGY | Stock Exchange vs. DOHOME | Stock Exchange vs. Srinanaporn Marketing Public |
| Thai Rubber vs. Business Online PCL | Thai Rubber vs. Communication System Solution | Thai Rubber vs. CI Group Public | Thai Rubber vs. The Erawan Group |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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