Correlation Between Thai Beverage and Fernhill Beverage
Can any of the company-specific risk be diversified away by investing in both Thai Beverage and Fernhill Beverage 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 Fernhill Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Beverage PCL and Fernhill Beverage, you can compare the effects of market volatilities on Thai Beverage and Fernhill Beverage 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 Fernhill Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Beverage and Fernhill Beverage.
Diversification Opportunities for Thai Beverage and Fernhill Beverage
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Thai and Fernhill is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage PCL and Fernhill Beverage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fernhill Beverage 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 PCL are associated (or correlated) with Fernhill Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fernhill Beverage has no effect on the direction of Thai Beverage i.e., Thai Beverage and Fernhill Beverage go up and down completely randomly.
Pair Corralation between Thai Beverage and Fernhill Beverage
If you would invest 0.01 in Fernhill Beverage on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Fernhill Beverage or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Thai Beverage PCL vs. Fernhill Beverage
Performance |
| Timeline |
| Thai Beverage PCL |
| Fernhill Beverage |
Thai Beverage and Fernhill Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Beverage and Fernhill Beverage
The main advantage of trading using opposite Thai Beverage and Fernhill Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Beverage position performs unexpectedly, Fernhill Beverage 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 Fernhill Beverage will offset losses from the drop in Fernhill Beverage's long position.| Thai Beverage vs. Diageo PLC ADR | Thai Beverage vs. Constellation Brands Class | Thai Beverage vs. Morningstar Unconstrained Allocation | Thai Beverage vs. SEI Investments |
| Fernhill Beverage vs. National Beverage Corp | Fernhill Beverage vs. Vita Coco | Fernhill Beverage vs. Hill Street Beverage | Fernhill Beverage vs. Alkame Holdings |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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