Correlation Between Ratchthani Leasing and Thai Steel
Can any of the company-specific risk be diversified away by investing in both Ratchthani Leasing and Thai Steel 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 Ratchthani Leasing and Thai Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ratchthani Leasing Public and Thai Steel Cable, you can compare the effects of market volatilities on Ratchthani Leasing and Thai Steel 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 Ratchthani Leasing with a short position of Thai Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ratchthani Leasing and Thai Steel.
Diversification Opportunities for Ratchthani Leasing and Thai Steel
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ratchthani and Thai is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Ratchthani Leasing Public and Thai Steel Cable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Steel Cable and Ratchthani Leasing 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 Ratchthani Leasing Public are associated (or correlated) with Thai Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Steel Cable has no effect on the direction of Ratchthani Leasing i.e., Ratchthani Leasing and Thai Steel go up and down completely randomly.
Pair Corralation between Ratchthani Leasing and Thai Steel
Assuming the 90 days trading horizon Ratchthani Leasing is expected to generate 1.06 times less return on investment than Thai Steel. In addition to that, Ratchthani Leasing is 1.0 times more volatile than Thai Steel Cable. It trades about 0.05 of its total potential returns per unit of risk. Thai Steel Cable is currently generating about 0.05 per unit of volatility. If you would invest 1,316 in Thai Steel Cable on September 12, 2024 and sell it today you would earn a total of 184.00 from holding Thai Steel Cable or generate 13.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ratchthani Leasing Public vs. Thai Steel Cable
Performance |
| Timeline |
| Ratchthani Leasing Public |
| Thai Steel Cable |
Ratchthani Leasing and Thai Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ratchthani Leasing and Thai Steel
The main advantage of trading using opposite Ratchthani Leasing and Thai Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ratchthani Leasing position performs unexpectedly, Thai Steel 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 Thai Steel will offset losses from the drop in Thai Steel's long position.| Ratchthani Leasing vs. KGI Securities Public | Ratchthani Leasing vs. Lalin Property Public | Ratchthani Leasing vs. Hwa Fong Rubber | Ratchthani Leasing vs. MCS Steel Public |
| Thai Steel vs. Hwa Fong Rubber | Thai Steel vs. AAPICO Hitech Public | Thai Steel vs. Haad Thip Public | Thai Steel vs. Italian Thai Development Public |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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