Correlation Between Thai Coating and Neo Corporate
Can any of the company-specific risk be diversified away by investing in both Thai Coating and Neo Corporate 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 Neo Corporate 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 Neo Corporate Pcl, you can compare the effects of market volatilities on Thai Coating and Neo Corporate 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 Neo Corporate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Coating and Neo Corporate.
Diversification Opportunities for Thai Coating and Neo Corporate
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Thai and Neo is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Thai Coating Industrial and Neo Corporate Pcl in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neo Corporate Pcl 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 Neo Corporate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neo Corporate Pcl has no effect on the direction of Thai Coating i.e., Thai Coating and Neo Corporate go up and down completely randomly.
Pair Corralation between Thai Coating and Neo Corporate
Assuming the 90 days trading horizon Thai Coating is expected to generate 144.83 times less return on investment than Neo Corporate. But when comparing it to its historical volatility, Thai Coating Industrial is 32.62 times less risky than Neo Corporate. It trades about 0.02 of its potential returns per unit of risk. Neo Corporate Pcl is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 3,900 in Neo Corporate Pcl on December 4, 2024 and sell it today you would lose (775.00) from holding Neo Corporate Pcl or give up 19.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 92.86% |
| Values | Daily Returns |
Thai Coating Industrial vs. Neo Corporate Pcl
Performance |
| Timeline |
| Thai Coating Industrial |
| Neo Corporate Pcl |
Thai Coating and Neo Corporate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Coating and Neo Corporate
The main advantage of trading using opposite Thai Coating and Neo Corporate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Coating position performs unexpectedly, Neo Corporate 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 Neo Corporate will offset losses from the drop in Neo Corporate's long position.| Thai Coating vs. Thantawan Industry Public | Thai Coating vs. Thai Packaging Printing | Thai Coating vs. Thai Metal Drum | Thai Coating vs. Thai Film Industries |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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