Correlation Between Thai Coating and AIM Industrial
Can any of the company-specific risk be diversified away by investing in both Thai Coating and AIM Industrial 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 Coating and AIM Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Coating Industrial and AIM Industrial Growth, you can compare the effects of market volatilities on Thai Coating and AIM Industrial 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 Coating with a short position of AIM Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Coating and AIM Industrial.
Diversification Opportunities for Thai Coating and AIM Industrial
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Thai and AIM is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Thai Coating Industrial and AIM Industrial Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AIM Industrial Growth and Thai Coating 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 Coating Industrial are associated (or correlated) with AIM Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AIM Industrial Growth has no effect on the direction of Thai Coating i.e., Thai Coating and AIM Industrial go up and down completely randomly.
Pair Corralation between Thai Coating and AIM Industrial
Assuming the 90 days trading horizon Thai Coating Industrial is expected to generate 11.48 times more return on investment than AIM Industrial. However, Thai Coating is 11.48 times more volatile than AIM Industrial Growth. It trades about 0.04 of its potential returns per unit of risk. AIM Industrial Growth is currently generating about 0.14 per unit of risk. If you would invest 2,525 in Thai Coating Industrial on September 13, 2024 and sell it today you would earn a total of 25.00 from holding Thai Coating Industrial or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thai Coating Industrial vs. AIM Industrial Growth
Performance |
| Timeline |
| Thai Coating Industrial |
| AIM Industrial Growth |
Thai Coating and AIM Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Coating and AIM Industrial
The main advantage of trading using opposite Thai Coating and AIM Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Coating position performs unexpectedly, AIM Industrial 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 AIM Industrial will offset losses from the drop in AIM Industrial's long position.| Thai Coating vs. Thantawan Industry Public | Thai Coating vs. The Erawan Group | Thai Coating vs. Jay Mart Public | Thai Coating vs. Airports of Thailand |
| AIM Industrial vs. Amata Summit Growth | AIM Industrial vs. WHA Premium Growth | AIM Industrial vs. Digital Telecommunications Infrastructure | AIM Industrial vs. Quality Houses Property |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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