Correlation Between Thai Beverage and LASSONDE INDUSTINC
Can any of the company-specific risk be diversified away by investing in both Thai Beverage and LASSONDE INDUSTINC 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 LASSONDE INDUSTINC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Beverage Public and LASSONDE INDUSTINC A, you can compare the effects of market volatilities on Thai Beverage and LASSONDE INDUSTINC 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 LASSONDE INDUSTINC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Beverage and LASSONDE INDUSTINC.
Diversification Opportunities for Thai Beverage and LASSONDE INDUSTINC
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Thai and LASSONDE is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage Public and LASSONDE INDUSTINC A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LASSONDE INDUSTINC 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 Public are associated (or correlated) with LASSONDE INDUSTINC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LASSONDE INDUSTINC has no effect on the direction of Thai Beverage i.e., Thai Beverage and LASSONDE INDUSTINC go up and down completely randomly.
Pair Corralation between Thai Beverage and LASSONDE INDUSTINC
Assuming the 90 days horizon Thai Beverage Public is expected to generate 1.24 times more return on investment than LASSONDE INDUSTINC. However, Thai Beverage is 1.24 times more volatile than LASSONDE INDUSTINC A. It trades about 0.06 of its potential returns per unit of risk. LASSONDE INDUSTINC A is currently generating about 0.04 per unit of risk. If you would invest 35.00 in Thai Beverage Public on September 12, 2024 and sell it today you would earn a total of 3.00 from holding Thai Beverage Public or generate 8.57% 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 Public vs. LASSONDE INDUSTINC A
Performance |
| Timeline |
| Thai Beverage Public |
| LASSONDE INDUSTINC |
Thai Beverage and LASSONDE INDUSTINC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Beverage and LASSONDE INDUSTINC
The main advantage of trading using opposite Thai Beverage and LASSONDE INDUSTINC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Beverage position performs unexpectedly, LASSONDE INDUSTINC 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 LASSONDE INDUSTINC will offset losses from the drop in LASSONDE INDUSTINC's long position.| Thai Beverage vs. Diageo plc | Thai Beverage vs. Rmy Cointreau SA | Thai Beverage vs. Treasury Wine Estates |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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