Correlation Between THAI BEVERAGE and Strix Group
Can any of the company-specific risk be diversified away by investing in both THAI BEVERAGE and Strix Group 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 Strix Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THAI BEVERAGE and Strix Group Plc, you can compare the effects of market volatilities on THAI BEVERAGE and Strix Group 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 Strix Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of THAI BEVERAGE and Strix Group.
Diversification Opportunities for THAI BEVERAGE and Strix Group
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between THAI and Strix is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding THAI BEVERAGE and Strix Group Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strix Group Plc 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 Strix Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strix Group Plc has no effect on the direction of THAI BEVERAGE i.e., THAI BEVERAGE and Strix Group go up and down completely randomly.
Pair Corralation between THAI BEVERAGE and Strix Group
Assuming the 90 days trading horizon THAI BEVERAGE is expected to generate 1.51 times more return on investment than Strix Group. However, THAI BEVERAGE is 1.51 times more volatile than Strix Group Plc. It trades about 0.06 of its potential returns per unit of risk. Strix Group Plc is currently generating about -0.01 per unit of risk. If you would invest 15.00 in THAI BEVERAGE on September 3, 2024 and sell it today you would earn a total of 24.00 from holding THAI BEVERAGE or generate 160.0% 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. Strix Group Plc
Performance |
| Timeline |
| THAI BEVERAGE |
| Strix Group Plc |
THAI BEVERAGE and Strix Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with THAI BEVERAGE and Strix Group
The main advantage of trading using opposite THAI BEVERAGE and Strix Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THAI BEVERAGE position performs unexpectedly, Strix Group 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 Strix Group will offset losses from the drop in Strix Group'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 |
| Strix Group vs. Steel Dynamics | Strix Group vs. Datang International Power | Strix Group vs. Automatic Data Processing | Strix Group vs. RELIANCE STEEL AL |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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