Correlation Between Thai Beverage and Marfrig Global
Can any of the company-specific risk be diversified away by investing in both Thai Beverage and Marfrig Global 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 Marfrig Global 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 Marfrig Global Foods, you can compare the effects of market volatilities on Thai Beverage and Marfrig Global 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 Marfrig Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Beverage and Marfrig Global.
Diversification Opportunities for Thai Beverage and Marfrig Global
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Thai and Marfrig is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage PCL and Marfrig Global Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marfrig Global Foods 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 Marfrig Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marfrig Global Foods has no effect on the direction of Thai Beverage i.e., Thai Beverage and Marfrig Global go up and down completely randomly.
Pair Corralation between Thai Beverage and Marfrig Global
Assuming the 90 days horizon Thai Beverage PCL is expected to under-perform the Marfrig Global. But the pink sheet apears to be less risky and, when comparing its historical volatility, Thai Beverage PCL is 1.7 times less risky than Marfrig Global. The pink sheet trades about -0.06 of its potential returns per unit of risk. The Marfrig Global Foods is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 130.00 in Marfrig Global Foods on August 24, 2024 and sell it today you would earn a total of 155.00 from holding Marfrig Global Foods or generate 119.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 60.08% |
| Values | Daily Returns |
Thai Beverage PCL vs. Marfrig Global Foods
Performance |
| Timeline |
| Thai Beverage PCL |
| Marfrig Global Foods |
Thai Beverage and Marfrig Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Beverage and Marfrig Global
The main advantage of trading using opposite Thai Beverage and Marfrig Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Beverage position performs unexpectedly, Marfrig Global 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 Marfrig Global will offset losses from the drop in Marfrig Global's long position.| Thai Beverage vs. Andrew Peller Limited | Thai Beverage vs. Aristocrat Group Corp | Thai Beverage vs. Iconic Brands | Thai Beverage vs. Naked Wines plc |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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