Correlation Between Thaire Life and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Thaire Life and Dow Jones 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 Thaire Life and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thaire Life Assurance and Dow Jones Industrial, you can compare the effects of market volatilities on Thaire Life and Dow Jones 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 Thaire Life with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thaire Life and Dow Jones.
Diversification Opportunities for Thaire Life and Dow Jones
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Thaire and Dow is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Thaire Life Assurance and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Thaire Life 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 Thaire Life Assurance are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Thaire Life i.e., Thaire Life and Dow Jones go up and down completely randomly.
Pair Corralation between Thaire Life and Dow Jones
Assuming the 90 days trading horizon Thaire Life Assurance is expected to generate 64.66 times more return on investment than Dow Jones. However, Thaire Life is 64.66 times more volatile than Dow Jones Industrial. It trades about 0.04 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of risk. If you would invest 503.00 in Thaire Life Assurance on November 4, 2024 and sell it today you would lose (374.00) from holding Thaire Life Assurance or give up 74.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.98% |
| Values | Daily Returns |
Thaire Life Assurance vs. Dow Jones Industrial
Performance |
| Timeline |
Thaire Life and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Thaire Life Assurance
Pair trading matchups for Thaire Life
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Thaire Life and Dow Jones
The main advantage of trading using opposite Thaire Life and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thaire Life position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Thaire Life vs. Thai Reinsurance Public | Thaire Life vs. Ratchthani Leasing Public | Thaire Life vs. Bangkok Life Assurance | Thaire Life vs. Thanachart Capital 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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