Correlation Between THAI BEVERAGE and Performance Food
Can any of the company-specific risk be diversified away by investing in both THAI BEVERAGE and Performance Food 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 Performance Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THAI BEVERAGE and Performance Food Group, you can compare the effects of market volatilities on THAI BEVERAGE and Performance Food 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 Performance Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of THAI BEVERAGE and Performance Food.
Diversification Opportunities for THAI BEVERAGE and Performance Food
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between THAI and Performance is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding THAI BEVERAGE and Performance Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Performance Food 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 Performance Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Performance Food has no effect on the direction of THAI BEVERAGE i.e., THAI BEVERAGE and Performance Food go up and down completely randomly.
Pair Corralation between THAI BEVERAGE and Performance Food
Assuming the 90 days trading horizon THAI BEVERAGE is expected to generate 3.41 times more return on investment than Performance Food. However, THAI BEVERAGE is 3.41 times more volatile than Performance Food Group. It trades about 0.08 of its potential returns per unit of risk. Performance Food Group is currently generating about 0.09 per unit of risk. If you would invest 18.00 in THAI BEVERAGE on September 2, 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 Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
THAI BEVERAGE vs. Performance Food Group
Performance |
| Timeline |
| THAI BEVERAGE |
| Performance Food |
THAI BEVERAGE and Performance Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with THAI BEVERAGE and Performance Food
The main advantage of trading using opposite THAI BEVERAGE and Performance Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THAI BEVERAGE position performs unexpectedly, Performance Food 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 Performance Food will offset losses from the drop in Performance Food's long position.| THAI BEVERAGE vs. SIVERS SEMICONDUCTORS AB | THAI BEVERAGE vs. Darden Restaurants | THAI BEVERAGE vs. Reliance Steel Aluminum | THAI BEVERAGE vs. Q2M Managementberatung AG |
| Performance Food vs. Apple Inc | Performance Food vs. Apple Inc | Performance Food vs. Apple Inc | Performance Food vs. Apple Inc |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |