Correlation Between Thai Beverage and Appen
Can any of the company-specific risk be diversified away by investing in both Thai Beverage and Appen 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 Appen 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 Appen Limited, you can compare the effects of market volatilities on Thai Beverage and Appen 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 Appen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Beverage and Appen.
Diversification Opportunities for Thai Beverage and Appen
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Thai and Appen is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage Public and Appen Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Appen Limited 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 Appen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Appen Limited has no effect on the direction of Thai Beverage i.e., Thai Beverage and Appen go up and down completely randomly.
Pair Corralation between Thai Beverage and Appen
Assuming the 90 days horizon Thai Beverage is expected to generate 2.33 times less return on investment than Appen. But when comparing it to its historical volatility, Thai Beverage Public is 1.55 times less risky than Appen. It trades about 0.07 of its potential returns per unit of risk. Appen Limited is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 35.00 in Appen Limited on August 27, 2024 and sell it today you would earn a total of 92.00 from holding Appen Limited or generate 262.86% 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. Appen Limited
Performance |
| Timeline |
| Thai Beverage Public |
| Appen Limited |
Thai Beverage and Appen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Beverage and Appen
The main advantage of trading using opposite Thai Beverage and Appen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Beverage position performs unexpectedly, Appen 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 Appen will offset losses from the drop in Appen's long position.| Thai Beverage vs. LGI Homes | Thai Beverage vs. Hisense Home Appliances | Thai Beverage vs. MeVis Medical Solutions | Thai Beverage vs. Neinor Homes SA |
| Appen vs. BOSTON BEER A | Appen vs. THAI BEVERAGE | Appen vs. Tsingtao Brewery | Appen vs. Thai Beverage Public |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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