Correlation Between THAI BEVERAGE and Planet Fitness
Can any of the company-specific risk be diversified away by investing in both THAI BEVERAGE and Planet Fitness 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 THAI BEVERAGE and Planet Fitness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THAI BEVERAGE and Planet Fitness, you can compare the effects of market volatilities on THAI BEVERAGE and Planet Fitness 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 THAI BEVERAGE with a short position of Planet Fitness. Check out your portfolio center. Please also check ongoing floating volatility patterns of THAI BEVERAGE and Planet Fitness.
Diversification Opportunities for THAI BEVERAGE and Planet Fitness
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between THAI and Planet is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding THAI BEVERAGE and Planet Fitness in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Planet Fitness and THAI BEVERAGE 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 THAI BEVERAGE are associated (or correlated) with Planet Fitness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Planet Fitness has no effect on the direction of THAI BEVERAGE i.e., THAI BEVERAGE and Planet Fitness go up and down completely randomly.
Pair Corralation between THAI BEVERAGE and Planet Fitness
Assuming the 90 days trading horizon THAI BEVERAGE is expected to under-perform the Planet Fitness. In addition to that, THAI BEVERAGE is 1.23 times more volatile than Planet Fitness. It trades about -0.1 of its total potential returns per unit of risk. Planet Fitness is currently generating about 0.09 per unit of volatility. If you would invest 9,350 in Planet Fitness on October 30, 2024 and sell it today you would earn a total of 450.00 from holding Planet Fitness or generate 4.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
THAI BEVERAGE vs. Planet Fitness
Performance |
| Timeline |
| THAI BEVERAGE |
| Planet Fitness |
THAI BEVERAGE and Planet Fitness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with THAI BEVERAGE and Planet Fitness
The main advantage of trading using opposite THAI BEVERAGE and Planet Fitness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THAI BEVERAGE position performs unexpectedly, Planet Fitness 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 Planet Fitness will offset losses from the drop in Planet Fitness' long position.| THAI BEVERAGE vs. MOVIE GAMES SA | THAI BEVERAGE vs. TAL Education Group | THAI BEVERAGE vs. TEN SQUARE GAMES | THAI BEVERAGE vs. EEDUCATION ALBERT AB |
| Planet Fitness vs. Booking Holdings | Planet Fitness vs. Oriental Land Co | Planet Fitness vs. ANTA Sports Products | Planet Fitness vs. Li Ning Company |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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