Correlation Between Thaifoods Group and CK Power
Can any of the company-specific risk be diversified away by investing in both Thaifoods Group and CK Power 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 CK Power 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 CK Power Public, you can compare the effects of market volatilities on Thaifoods Group and CK Power 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 CK Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thaifoods Group and CK Power.
Diversification Opportunities for Thaifoods Group and CK Power
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Thaifoods and CKP is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Thaifoods Group Public and CK Power Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CK Power Public 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 CK Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CK Power Public has no effect on the direction of Thaifoods Group i.e., Thaifoods Group and CK Power go up and down completely randomly.
Pair Corralation between Thaifoods Group and CK Power
Assuming the 90 days trading horizon Thaifoods Group Public is expected to generate 1.15 times more return on investment than CK Power. However, Thaifoods Group is 1.15 times more volatile than CK Power Public. It trades about -0.02 of its potential returns per unit of risk. CK Power Public is currently generating about -0.08 per unit of risk. If you would invest 397.00 in Thaifoods Group Public on September 1, 2024 and sell it today you would lose (29.00) from holding Thaifoods Group Public or give up 7.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thaifoods Group Public vs. CK Power Public
Performance |
| Timeline |
| Thaifoods Group Public |
| CK Power Public |
Thaifoods Group and CK Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thaifoods Group and CK Power
The main advantage of trading using opposite Thaifoods Group and CK Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thaifoods Group position performs unexpectedly, CK Power 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 CK Power will offset losses from the drop in CK Power's long position.| Thaifoods Group vs. GFPT Public | Thaifoods Group vs. Thai Union Group | Thaifoods Group vs. Taokaenoi Food Marketing | Thaifoods Group vs. Com7 PCL |
| CK Power vs. Energy Absolute Public | CK Power vs. BCPG Public | CK Power vs. Bangkok Expressway and | CK Power vs. Gulf Energy Development |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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