Correlation Between THAI BEVERAGE and DATA MODUL
Can any of the company-specific risk be diversified away by investing in both THAI BEVERAGE and DATA MODUL 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 DATA MODUL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THAI BEVERAGE and DATA MODUL , you can compare the effects of market volatilities on THAI BEVERAGE and DATA MODUL 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 DATA MODUL. Check out your portfolio center. Please also check ongoing floating volatility patterns of THAI BEVERAGE and DATA MODUL.
Diversification Opportunities for THAI BEVERAGE and DATA MODUL
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between THAI and DATA is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding THAI BEVERAGE and DATA MODUL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DATA MODUL 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 DATA MODUL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DATA MODUL has no effect on the direction of THAI BEVERAGE i.e., THAI BEVERAGE and DATA MODUL go up and down completely randomly.
Pair Corralation between THAI BEVERAGE and DATA MODUL
Assuming the 90 days trading horizon THAI BEVERAGE is expected to generate 2.33 times more return on investment than DATA MODUL. However, THAI BEVERAGE is 2.33 times more volatile than DATA MODUL . It trades about 0.05 of its potential returns per unit of risk. DATA MODUL is currently generating about -0.06 per unit of risk. If you would invest 15.00 in THAI BEVERAGE on October 27, 2024 and sell it today you would earn a total of 21.00 from holding THAI BEVERAGE or generate 140.0% 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. DATA MODUL
Performance |
| Timeline |
| THAI BEVERAGE |
| DATA MODUL |
THAI BEVERAGE and DATA MODUL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with THAI BEVERAGE and DATA MODUL
The main advantage of trading using opposite THAI BEVERAGE and DATA MODUL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THAI BEVERAGE position performs unexpectedly, DATA MODUL 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 DATA MODUL will offset losses from the drop in DATA MODUL's long position.| THAI BEVERAGE vs. Molson Coors Beverage | THAI BEVERAGE vs. Maple Leaf Foods | THAI BEVERAGE vs. BRIT AMER TOBACCO | THAI BEVERAGE vs. High Liner Foods |
| DATA MODUL vs. GALENA MINING LTD | DATA MODUL vs. MAGNUM MINING EXP | DATA MODUL vs. Commercial Vehicle Group | DATA MODUL vs. Harmony Gold Mining |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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