Correlation Between THAI BEVERAGE and Mitsui Fudosan
Can any of the company-specific risk be diversified away by investing in both THAI BEVERAGE and Mitsui Fudosan 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 Mitsui Fudosan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THAI BEVERAGE and Mitsui Fudosan Co, you can compare the effects of market volatilities on THAI BEVERAGE and Mitsui Fudosan 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 Mitsui Fudosan. Check out your portfolio center. Please also check ongoing floating volatility patterns of THAI BEVERAGE and Mitsui Fudosan.
Diversification Opportunities for THAI BEVERAGE and Mitsui Fudosan
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between THAI and Mitsui is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding THAI BEVERAGE and Mitsui Fudosan Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitsui Fudosan 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 Mitsui Fudosan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitsui Fudosan has no effect on the direction of THAI BEVERAGE i.e., THAI BEVERAGE and Mitsui Fudosan go up and down completely randomly.
Pair Corralation between THAI BEVERAGE and Mitsui Fudosan
Assuming the 90 days trading horizon THAI BEVERAGE is expected to generate 2.7 times more return on investment than Mitsui Fudosan. However, THAI BEVERAGE is 2.7 times more volatile than Mitsui Fudosan Co. It trades about 0.1 of its potential returns per unit of risk. Mitsui Fudosan Co is currently generating about -0.05 per unit of risk. If you would invest 18.00 in THAI BEVERAGE on September 3, 2024 and sell it today you would earn a total of 21.00 from holding THAI BEVERAGE or generate 116.67% 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. Mitsui Fudosan Co
Performance |
| Timeline |
| THAI BEVERAGE |
| Mitsui Fudosan |
THAI BEVERAGE and Mitsui Fudosan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with THAI BEVERAGE and Mitsui Fudosan
The main advantage of trading using opposite THAI BEVERAGE and Mitsui Fudosan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THAI BEVERAGE position performs unexpectedly, Mitsui Fudosan 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 Mitsui Fudosan will offset losses from the drop in Mitsui Fudosan's long position.| THAI BEVERAGE vs. Ramsay Health Care | THAI BEVERAGE vs. National Health Investors | THAI BEVERAGE vs. Air Transport Services | THAI BEVERAGE vs. Texas Roadhouse |
| Mitsui Fudosan vs. NISSAN CHEMICAL IND | Mitsui Fudosan vs. PTT Global Chemical | Mitsui Fudosan vs. Sekisui Chemical Co | Mitsui Fudosan vs. United Breweries Co |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |