Correlation Between Thai Beverage and FRASERS PROPERTY
Can any of the company-specific risk be diversified away by investing in both Thai Beverage and FRASERS PROPERTY 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 FRASERS PROPERTY 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 FRASERS PROPERTY, you can compare the effects of market volatilities on Thai Beverage and FRASERS PROPERTY 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 FRASERS PROPERTY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Beverage and FRASERS PROPERTY.
Diversification Opportunities for Thai Beverage and FRASERS PROPERTY
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Thai and FRASERS is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage Public and FRASERS PROPERTY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FRASERS PROPERTY 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 FRASERS PROPERTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FRASERS PROPERTY has no effect on the direction of Thai Beverage i.e., Thai Beverage and FRASERS PROPERTY go up and down completely randomly.
Pair Corralation between Thai Beverage and FRASERS PROPERTY
Assuming the 90 days horizon Thai Beverage Public is expected to generate 2.66 times more return on investment than FRASERS PROPERTY. However, Thai Beverage is 2.66 times more volatile than FRASERS PROPERTY. It trades about 0.05 of its potential returns per unit of risk. FRASERS PROPERTY is currently generating about 0.05 per unit of risk. If you would invest 22.00 in Thai Beverage Public on September 12, 2024 and sell it today you would earn a total of 16.00 from holding Thai Beverage Public or generate 72.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thai Beverage Public vs. FRASERS PROPERTY
Performance |
| Timeline |
| Thai Beverage Public |
| FRASERS PROPERTY |
Thai Beverage and FRASERS PROPERTY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Beverage and FRASERS PROPERTY
The main advantage of trading using opposite Thai Beverage and FRASERS PROPERTY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Beverage position performs unexpectedly, FRASERS PROPERTY 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 FRASERS PROPERTY will offset losses from the drop in FRASERS PROPERTY's long position.| Thai Beverage vs. Diageo plc | Thai Beverage vs. Rmy Cointreau SA | Thai Beverage vs. Treasury Wine Estates |
| FRASERS PROPERTY vs. OPEN HOUSE GROUP | FRASERS PROPERTY vs. Superior Plus Corp | FRASERS PROPERTY vs. SIVERS SEMICONDUCTORS AB | FRASERS PROPERTY vs. CHINA HUARONG ENERHD 50 |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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