Correlation Between Thaifoods Group and Krung Thai

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Can any of the company-specific risk be diversified away by investing in both Thaifoods Group and Krung Thai 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 Thaifoods Group and Krung Thai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thaifoods Group Public and Krung Thai Bank, you can compare the effects of market volatilities on Thaifoods Group and Krung Thai 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 Thaifoods Group with a short position of Krung Thai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thaifoods Group and Krung Thai.

Diversification Opportunities for Thaifoods Group and Krung Thai

ThaifoodsKrungDiversified AwayThaifoodsKrungDiversified Away100%
-0.2
  Correlation Coefficient

Good diversification

The 3 months correlation between Thaifoods and Krung is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Thaifoods Group Public and Krung Thai Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Krung Thai Bank and Thaifoods Group 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 Thaifoods Group Public are associated (or correlated) with Krung Thai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Krung Thai Bank has no effect on the direction of Thaifoods Group i.e., Thaifoods Group and Krung Thai go up and down completely randomly.

Pair Corralation between Thaifoods Group and Krung Thai

If you would invest  2,040  in Krung Thai Bank on November 14, 2024 and sell it today you would earn a total of  290.00  from holding Krung Thai Bank or generate 14.22% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Thaifoods Group Public  vs.  Krung Thai Bank

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -50510
JavaScript chart by amCharts 3.21.15TFG-R KTB-R
       Timeline  
Thaifoods Group Public 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Thaifoods Group Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, Thaifoods Group is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb4.14.15
Krung Thai Bank 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Krung Thai Bank are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental drivers, Krung Thai sustained solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb2020.52121.52222.52323.524

Thaifoods Group and Krung Thai Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.05-3.06-2.06-1.06-0.06760.821.712.593.474.35 0.050.100.150.20
JavaScript chart by amCharts 3.21.15TFG-R KTB-R
       Returns  

Pair Trading with Thaifoods Group and Krung Thai

The main advantage of trading using opposite Thaifoods Group and Krung Thai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thaifoods Group position performs unexpectedly, Krung Thai 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 Krung Thai will offset losses from the drop in Krung Thai's long position.
The idea behind Thaifoods Group Public and Krung Thai Bank pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

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