Correlation Between Surapon Foods and Tropical Canning
Can any of the company-specific risk be diversified away by investing in both Surapon Foods and Tropical Canning 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 Tropical Canning 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 Tropical Canning Public, you can compare the effects of market volatilities on Surapon Foods and Tropical Canning 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 Tropical Canning. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surapon Foods and Tropical Canning.
Diversification Opportunities for Surapon Foods and Tropical Canning
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Surapon and Tropical is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Surapon Foods Public and Tropical Canning Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tropical Canning Public 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 Tropical Canning. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tropical Canning Public has no effect on the direction of Surapon Foods i.e., Surapon Foods and Tropical Canning go up and down completely randomly.
Pair Corralation between Surapon Foods and Tropical Canning
Assuming the 90 days trading horizon Surapon Foods Public is expected to generate 1.0 times more return on investment than Tropical Canning. However, Surapon Foods Public is 1.0 times less risky than Tropical Canning. It trades about 0.04 of its potential returns per unit of risk. Tropical Canning Public is currently generating about 0.04 per unit of risk. If you would invest 763.00 in Surapon Foods Public on September 3, 2024 and sell it today you would lose (68.00) from holding Surapon Foods Public or give up 8.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Surapon Foods Public vs. Tropical Canning Public
Performance |
| Timeline |
| Surapon Foods Public |
| Tropical Canning Public |
Surapon Foods and Tropical Canning Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surapon Foods and Tropical Canning
The main advantage of trading using opposite Surapon Foods and Tropical Canning positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surapon Foods position performs unexpectedly, Tropical Canning 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 Tropical Canning will offset losses from the drop in Tropical Canning's long position.| Surapon Foods vs. Airports of Thailand | Surapon Foods vs. PTT Public | Surapon Foods vs. Bangkok Dusit Medical | Surapon Foods vs. Kasikornbank Public |
| Tropical Canning vs. Thai Vegetable Oil | Tropical Canning vs. Tipco Foods Public | Tropical Canning vs. Haad Thip Public | Tropical Canning vs. SP Syndicate 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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