Correlation Between Surapon Foods and Chiangmai Frozen
Can any of the company-specific risk be diversified away by investing in both Surapon Foods and Chiangmai Frozen 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 Surapon Foods and Chiangmai Frozen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Surapon Foods Public and Chiangmai Frozen Foods, you can compare the effects of market volatilities on Surapon Foods and Chiangmai Frozen 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 Surapon Foods with a short position of Chiangmai Frozen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surapon Foods and Chiangmai Frozen.
Diversification Opportunities for Surapon Foods and Chiangmai Frozen
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Surapon and Chiangmai is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Surapon Foods Public and Chiangmai Frozen Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chiangmai Frozen Foods and Surapon Foods 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 Surapon Foods Public are associated (or correlated) with Chiangmai Frozen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chiangmai Frozen Foods has no effect on the direction of Surapon Foods i.e., Surapon Foods and Chiangmai Frozen go up and down completely randomly.
Pair Corralation between Surapon Foods and Chiangmai Frozen
Assuming the 90 days trading horizon Surapon Foods Public is expected to generate 1.0 times more return on investment than Chiangmai Frozen. However, Surapon Foods Public is 1.0 times less risky than Chiangmai Frozen. It trades about 0.04 of its potential returns per unit of risk. Chiangmai Frozen Foods is currently generating about 0.04 per unit of risk. If you would invest 727.00 in Surapon Foods Public on November 27, 2024 and sell it today you would lose (92.00) from holding Surapon Foods Public or give up 12.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Surapon Foods Public vs. Chiangmai Frozen Foods
Performance |
| Timeline |
| Surapon Foods Public |
| Chiangmai Frozen Foods |
Surapon Foods and Chiangmai Frozen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surapon Foods and Chiangmai Frozen
The main advantage of trading using opposite Surapon Foods and Chiangmai Frozen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surapon Foods position performs unexpectedly, Chiangmai Frozen 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 Chiangmai Frozen will offset losses from the drop in Chiangmai Frozen's long position.| Surapon Foods vs. Lee Feed Mill | Surapon Foods vs. GFPT Public | Surapon Foods vs. Thai Vegetable Oil | Surapon Foods vs. Thaitheparos Public |
| Chiangmai Frozen vs. Chumporn Palm Oil | Chiangmai Frozen vs. GFPT Public | Chiangmai Frozen vs. Crown Seal Public | Chiangmai Frozen vs. Dynasty Ceramic 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |