Correlation Between Thai Beverage and Power Assets
Can any of the company-specific risk be diversified away by investing in both Thai Beverage and Power Assets 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 Power Assets 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 Power Assets Holdings, you can compare the effects of market volatilities on Thai Beverage and Power Assets 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 Power Assets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Beverage and Power Assets.
Diversification Opportunities for Thai Beverage and Power Assets
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thai and Power is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage Public and Power Assets Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Power Assets Holdings 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 Power Assets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Power Assets Holdings has no effect on the direction of Thai Beverage i.e., Thai Beverage and Power Assets go up and down completely randomly.
Pair Corralation between Thai Beverage and Power Assets
Assuming the 90 days horizon Thai Beverage Public is expected to generate 3.44 times more return on investment than Power Assets. However, Thai Beverage is 3.44 times more volatile than Power Assets Holdings. It trades about 0.02 of its potential returns per unit of risk. Power Assets Holdings is currently generating about -0.03 per unit of risk. If you would invest 37.00 in Thai Beverage Public on October 24, 2024 and sell it today you would earn a total of 0.00 from holding Thai Beverage Public or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
Thai Beverage Public vs. Power Assets Holdings
Performance |
| Timeline |
| Thai Beverage Public |
| Power Assets Holdings |
Thai Beverage and Power Assets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Beverage and Power Assets
The main advantage of trading using opposite Thai Beverage and Power Assets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Beverage position performs unexpectedly, Power Assets 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 Power Assets will offset losses from the drop in Power Assets' long position.| Thai Beverage vs. Hemisphere Energy Corp | Thai Beverage vs. ecotel communication ag | Thai Beverage vs. Adtalem Global Education | Thai Beverage vs. Charter Communications |
| Power Assets vs. Lamar Advertising | Power Assets vs. CARSALESCOM | Power Assets vs. BURLINGTON STORES | Power Assets vs. Caseys General Stores |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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