Correlation Between Steel Dynamics and Thanachart Capital
Can any of the company-specific risk be diversified away by investing in both Steel Dynamics and Thanachart Capital 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 Steel Dynamics and Thanachart Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steel Dynamics and Thanachart Capital Public, you can compare the effects of market volatilities on Steel Dynamics and Thanachart Capital 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 Steel Dynamics with a short position of Thanachart Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steel Dynamics and Thanachart Capital.
Diversification Opportunities for Steel Dynamics and Thanachart Capital
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Steel and Thanachart is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Steel Dynamics and Thanachart Capital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thanachart Capital Public and Steel Dynamics 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 Steel Dynamics are associated (or correlated) with Thanachart Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thanachart Capital Public has no effect on the direction of Steel Dynamics i.e., Steel Dynamics and Thanachart Capital go up and down completely randomly.
Pair Corralation between Steel Dynamics and Thanachart Capital
Given the investment horizon of 90 days Steel Dynamics is expected to generate 64.12 times less return on investment than Thanachart Capital. But when comparing it to its historical volatility, Steel Dynamics is 36.21 times less risky than Thanachart Capital. It trades about 0.04 of its potential returns per unit of risk. Thanachart Capital Public is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 4,230 in Thanachart Capital Public on September 4, 2024 and sell it today you would earn a total of 720.00 from holding Thanachart Capital Public or generate 17.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.58% |
| Values | Daily Returns |
Steel Dynamics vs. Thanachart Capital Public
Performance |
| Timeline |
| Steel Dynamics |
| Thanachart Capital Public |
Steel Dynamics and Thanachart Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steel Dynamics and Thanachart Capital
The main advantage of trading using opposite Steel Dynamics and Thanachart Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steel Dynamics position performs unexpectedly, Thanachart Capital 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 Thanachart Capital will offset losses from the drop in Thanachart Capital's long position.| Steel Dynamics vs. Cleveland Cliffs | Steel Dynamics vs. United States Steel | Steel Dynamics vs. ArcelorMittal SA ADR | Steel Dynamics vs. Reliance Steel Aluminum |
| Thanachart Capital vs. Kiatnakin Phatra Bank | Thanachart Capital vs. Supalai Public | Thanachart Capital vs. Thai Oil 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites |