Correlation Between THAI BEVERAGE and Sanyo Chemical
Can any of the company-specific risk be diversified away by investing in both THAI BEVERAGE and Sanyo Chemical 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 Sanyo Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THAI BEVERAGE and Sanyo Chemical Industries, you can compare the effects of market volatilities on THAI BEVERAGE and Sanyo Chemical 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 Sanyo Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of THAI BEVERAGE and Sanyo Chemical.
Diversification Opportunities for THAI BEVERAGE and Sanyo Chemical
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between THAI and Sanyo is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding THAI BEVERAGE and Sanyo Chemical Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanyo Chemical Industries 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 Sanyo Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanyo Chemical Industries has no effect on the direction of THAI BEVERAGE i.e., THAI BEVERAGE and Sanyo Chemical go up and down completely randomly.
Pair Corralation between THAI BEVERAGE and Sanyo Chemical
Assuming the 90 days trading horizon THAI BEVERAGE is expected to under-perform the Sanyo Chemical. In addition to that, THAI BEVERAGE is 1.37 times more volatile than Sanyo Chemical Industries. It trades about -0.08 of its total potential returns per unit of risk. Sanyo Chemical Industries is currently generating about -0.1 per unit of volatility. If you would invest 2,460 in Sanyo Chemical Industries on October 17, 2024 and sell it today you would lose (60.00) from holding Sanyo Chemical Industries or give up 2.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
THAI BEVERAGE vs. Sanyo Chemical Industries
Performance |
| Timeline |
| THAI BEVERAGE |
| Sanyo Chemical Industries |
THAI BEVERAGE and Sanyo Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with THAI BEVERAGE and Sanyo Chemical
The main advantage of trading using opposite THAI BEVERAGE and Sanyo Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THAI BEVERAGE position performs unexpectedly, Sanyo Chemical 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 Sanyo Chemical will offset losses from the drop in Sanyo Chemical's long position.| THAI BEVERAGE vs. ELMOS SEMICONDUCTOR | THAI BEVERAGE vs. Stag Industrial | THAI BEVERAGE vs. IMPERIAL TOBACCO | THAI BEVERAGE vs. Elmos Semiconductor SE |
| Sanyo Chemical vs. Thai Beverage Public | Sanyo Chemical vs. Tencent Music Entertainment | Sanyo Chemical vs. SAN MIGUEL BREWERY | Sanyo Chemical vs. THAI BEVERAGE |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |