Correlation Between Thai Coating and DTC Industries
Can any of the company-specific risk be diversified away by investing in both Thai Coating and DTC Industries 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 DTC Industries 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 DTC Industries Public, you can compare the effects of market volatilities on Thai Coating and DTC Industries 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 DTC Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Coating and DTC Industries.
Diversification Opportunities for Thai Coating and DTC Industries
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Thai and DTC is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Thai Coating Industrial and DTC Industries Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DTC Industries Public 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 DTC Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DTC Industries Public has no effect on the direction of Thai Coating i.e., Thai Coating and DTC Industries go up and down completely randomly.
Pair Corralation between Thai Coating and DTC Industries
Assuming the 90 days trading horizon Thai Coating Industrial is expected to generate 1.91 times more return on investment than DTC Industries. However, Thai Coating is 1.91 times more volatile than DTC Industries Public. It trades about 0.12 of its potential returns per unit of risk. DTC Industries Public is currently generating about -0.12 per unit of risk. If you would invest 2,400 in Thai Coating Industrial on September 2, 2024 and sell it today you would earn a total of 350.00 from holding Thai Coating Industrial or generate 14.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Thai Coating Industrial vs. DTC Industries Public
Performance |
| Timeline |
| Thai Coating Industrial |
| DTC Industries Public |
Thai Coating and DTC Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Coating and DTC Industries
The main advantage of trading using opposite Thai Coating and DTC Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Coating position performs unexpectedly, DTC Industries 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 DTC Industries will offset losses from the drop in DTC Industries' long position.| Thai Coating vs. AAPICO Hitech Public | Thai Coating vs. AP Public | Thai Coating vs. Aikchol Hospital Public | Thai Coating vs. Bank of Ayudhya |
| DTC Industries vs. Warrix Sport PCL | DTC Industries vs. Bank of Ayudhya | DTC Industries vs. Bhiraj Office Leasehold | DTC Industries vs. Digital Telecommunications Infrastructure |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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