Correlation Between Tipco Foods and TOA PAINT
Can any of the company-specific risk be diversified away by investing in both Tipco Foods and TOA PAINT 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 Tipco Foods and TOA PAINT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tipco Foods Public and TOA PAINT, you can compare the effects of market volatilities on Tipco Foods and TOA PAINT 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 Tipco Foods with a short position of TOA PAINT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tipco Foods and TOA PAINT.
Diversification Opportunities for Tipco Foods and TOA PAINT
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Tipco and TOA is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Tipco Foods Public and TOA PAINT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TOA PAINT and Tipco Foods 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 Tipco Foods Public are associated (or correlated) with TOA PAINT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TOA PAINT has no effect on the direction of Tipco Foods i.e., Tipco Foods and TOA PAINT go up and down completely randomly.
Pair Corralation between Tipco Foods and TOA PAINT
Assuming the 90 days trading horizon Tipco Foods Public is expected to generate 20.2 times more return on investment than TOA PAINT. However, Tipco Foods is 20.2 times more volatile than TOA PAINT. It trades about 0.05 of its potential returns per unit of risk. TOA PAINT is currently generating about -0.05 per unit of risk. If you would invest 864.00 in Tipco Foods Public on September 12, 2024 and sell it today you would earn a total of 156.00 from holding Tipco Foods Public or generate 18.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tipco Foods Public vs. TOA PAINT
Performance |
| Timeline |
| Tipco Foods Public |
| TOA PAINT |
Tipco Foods and TOA PAINT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tipco Foods and TOA PAINT
The main advantage of trading using opposite Tipco Foods and TOA PAINT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tipco Foods position performs unexpectedly, TOA PAINT 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 TOA PAINT will offset losses from the drop in TOA PAINT's long position.| Tipco Foods vs. GFPT Public | Tipco Foods vs. Dynasty Ceramic Public | Tipco Foods vs. Haad Thip Public | Tipco Foods vs. The Erawan Group |
| TOA PAINT vs. Tipco Foods Public | TOA PAINT vs. Bhiraj Office Leasehold | TOA PAINT vs. Charoen Pokphand Foods | TOA PAINT vs. Mitsib Leasing 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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