Correlation Between THAI BEVERAGE and InPlay Oil
Can any of the company-specific risk be diversified away by investing in both THAI BEVERAGE and InPlay Oil 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 InPlay Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THAI BEVERAGE and InPlay Oil Corp, you can compare the effects of market volatilities on THAI BEVERAGE and InPlay Oil 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 InPlay Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of THAI BEVERAGE and InPlay Oil.
Diversification Opportunities for THAI BEVERAGE and InPlay Oil
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between THAI and InPlay is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding THAI BEVERAGE and InPlay Oil Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InPlay Oil Corp 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 InPlay Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InPlay Oil Corp has no effect on the direction of THAI BEVERAGE i.e., THAI BEVERAGE and InPlay Oil go up and down completely randomly.
Pair Corralation between THAI BEVERAGE and InPlay Oil
Assuming the 90 days trading horizon THAI BEVERAGE is expected to generate 0.86 times more return on investment than InPlay Oil. However, THAI BEVERAGE is 1.16 times less risky than InPlay Oil. It trades about 0.01 of its potential returns per unit of risk. InPlay Oil Corp is currently generating about -0.03 per unit of risk. If you would invest 36.00 in THAI BEVERAGE on October 15, 2024 and sell it today you would earn a total of 0.00 from holding THAI BEVERAGE or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
THAI BEVERAGE vs. InPlay Oil Corp
Performance |
| Timeline |
| THAI BEVERAGE |
| InPlay Oil Corp |
THAI BEVERAGE and InPlay Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with THAI BEVERAGE and InPlay Oil
The main advantage of trading using opposite THAI BEVERAGE and InPlay Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THAI BEVERAGE position performs unexpectedly, InPlay Oil 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 InPlay Oil will offset losses from the drop in InPlay Oil's long position.| THAI BEVERAGE vs. TRADEDOUBLER AB SK | THAI BEVERAGE vs. Ares Management Corp | THAI BEVERAGE vs. CARSALESCOM | THAI BEVERAGE vs. FLOW TRADERS LTD |
| InPlay Oil vs. UNIQA INSURANCE GR | InPlay Oil vs. GRIFFIN MINING LTD | InPlay Oil vs. Cincinnati Financial Corp | InPlay Oil vs. SUN LIFE FINANCIAL |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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