Correlation Between Taokaenoi Food and Sahamit Machinery
Can any of the company-specific risk be diversified away by investing in both Taokaenoi Food and Sahamit Machinery 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 Taokaenoi Food and Sahamit Machinery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taokaenoi Food Marketing and Sahamit Machinery Public, you can compare the effects of market volatilities on Taokaenoi Food and Sahamit Machinery 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 Taokaenoi Food with a short position of Sahamit Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taokaenoi Food and Sahamit Machinery.
Diversification Opportunities for Taokaenoi Food and Sahamit Machinery
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Taokaenoi and Sahamit is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Taokaenoi Food Marketing and Sahamit Machinery Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sahamit Machinery Public and Taokaenoi Food 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 Taokaenoi Food Marketing are associated (or correlated) with Sahamit Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sahamit Machinery Public has no effect on the direction of Taokaenoi Food i.e., Taokaenoi Food and Sahamit Machinery go up and down completely randomly.
Pair Corralation between Taokaenoi Food and Sahamit Machinery
Assuming the 90 days trading horizon Taokaenoi Food Marketing is expected to under-perform the Sahamit Machinery. In addition to that, Taokaenoi Food is 4.74 times more volatile than Sahamit Machinery Public. It trades about -0.34 of its total potential returns per unit of risk. Sahamit Machinery Public is currently generating about -0.13 per unit of volatility. If you would invest 408.00 in Sahamit Machinery Public on September 13, 2024 and sell it today you would lose (6.00) from holding Sahamit Machinery Public or give up 1.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Taokaenoi Food Marketing vs. Sahamit Machinery Public
Performance |
| Timeline |
| Taokaenoi Food Marketing |
| Sahamit Machinery Public |
Taokaenoi Food and Sahamit Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taokaenoi Food and Sahamit Machinery
The main advantage of trading using opposite Taokaenoi Food and Sahamit Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taokaenoi Food position performs unexpectedly, Sahamit Machinery 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 Sahamit Machinery will offset losses from the drop in Sahamit Machinery's long position.| Taokaenoi Food vs. CP ALL Public | Taokaenoi Food vs. Carabao Group Public | Taokaenoi Food vs. Thai Union Group | Taokaenoi Food vs. Central Pattana Public |
| Sahamit Machinery vs. MCS Steel Public | Sahamit Machinery vs. Somboon Advance Technology | Sahamit Machinery vs. Lohakit Metal Public | Sahamit Machinery vs. SNC Former 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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