Correlation Between STPI Public and Thai Film
Can any of the company-specific risk be diversified away by investing in both STPI Public and Thai Film 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 STPI Public and Thai Film into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STPI Public and Thai Film Industries, you can compare the effects of market volatilities on STPI Public and Thai Film 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 STPI Public with a short position of Thai Film. Check out your portfolio center. Please also check ongoing floating volatility patterns of STPI Public and Thai Film.
Diversification Opportunities for STPI Public and Thai Film
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between STPI and Thai is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding STPI Public and Thai Film Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Film Industries and STPI Public 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 STPI Public are associated (or correlated) with Thai Film. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Film Industries has no effect on the direction of STPI Public i.e., STPI Public and Thai Film go up and down completely randomly.
Pair Corralation between STPI Public and Thai Film
Assuming the 90 days trading horizon STPI Public is expected to under-perform the Thai Film. But the stock apears to be less risky and, when comparing its historical volatility, STPI Public is 4.32 times less risky than Thai Film. The stock trades about -0.21 of its potential returns per unit of risk. The Thai Film Industries is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 6.00 in Thai Film Industries on November 29, 2024 and sell it today you would lose (1.00) from holding Thai Film Industries or give up 16.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
STPI Public vs. Thai Film Industries
Performance |
| Timeline |
| STPI Public |
| Thai Film Industries |
STPI Public and Thai Film Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STPI Public and Thai Film
The main advantage of trading using opposite STPI Public and Thai Film positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STPI Public position performs unexpectedly, Thai Film 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 Film will offset losses from the drop in Thai Film's long position.| STPI Public vs. CH Karnchang Public | STPI Public vs. Siri Prime Office | STPI Public vs. AP Public | STPI Public vs. SVI Public |
| Thai Film vs. Thai Reinsurance Public | Thai Film vs. STPI Public | Thai Film vs. Siri Prime Office | Thai Film vs. Thoresen Thai Agencies |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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