Correlation Between Thantawan Industry and Union Plastic
Can any of the company-specific risk be diversified away by investing in both Thantawan Industry and Union Plastic 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 Thantawan Industry and Union Plastic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thantawan Industry Public and Union Plastic Public, you can compare the effects of market volatilities on Thantawan Industry and Union Plastic 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 Thantawan Industry with a short position of Union Plastic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thantawan Industry and Union Plastic.
Diversification Opportunities for Thantawan Industry and Union Plastic
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thantawan and Union is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Thantawan Industry Public and Union Plastic Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union Plastic Public and Thantawan Industry 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 Thantawan Industry Public are associated (or correlated) with Union Plastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union Plastic Public has no effect on the direction of Thantawan Industry i.e., Thantawan Industry and Union Plastic go up and down completely randomly.
Pair Corralation between Thantawan Industry and Union Plastic
Assuming the 90 days trading horizon Thantawan Industry Public is expected to under-perform the Union Plastic. But the stock apears to be less risky and, when comparing its historical volatility, Thantawan Industry Public is 1.76 times less risky than Union Plastic. The stock trades about -0.27 of its potential returns per unit of risk. The Union Plastic Public is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 1,750 in Union Plastic Public on November 2, 2024 and sell it today you would lose (40.00) from holding Union Plastic Public or give up 2.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thantawan Industry Public vs. Union Plastic Public
Performance |
| Timeline |
| Thantawan Industry Public |
| Union Plastic Public |
Thantawan Industry and Union Plastic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thantawan Industry and Union Plastic
The main advantage of trading using opposite Thantawan Industry and Union Plastic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thantawan Industry position performs unexpectedly, Union Plastic 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 Union Plastic will offset losses from the drop in Union Plastic's long position.| Thantawan Industry vs. Thai Metal Drum | Thantawan Industry vs. Haad Thip Public | Thantawan Industry vs. Ratchthani Leasing Public |
| Union Plastic vs. Thai Poly Acrylic | Union Plastic vs. Union Pioneer Public | Union Plastic vs. Univentures Public | Union Plastic vs. Thantawan Industry 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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