Correlation Between Taokaenoi Food and Vibhavadi Medical
Can any of the company-specific risk be diversified away by investing in both Taokaenoi Food and Vibhavadi Medical 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 Vibhavadi Medical 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 Vibhavadi Medical Center, you can compare the effects of market volatilities on Taokaenoi Food and Vibhavadi Medical 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 Vibhavadi Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taokaenoi Food and Vibhavadi Medical.
Diversification Opportunities for Taokaenoi Food and Vibhavadi Medical
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Taokaenoi and Vibhavadi is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Taokaenoi Food Marketing and Vibhavadi Medical Center in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vibhavadi Medical Center 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 Vibhavadi Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vibhavadi Medical Center has no effect on the direction of Taokaenoi Food i.e., Taokaenoi Food and Vibhavadi Medical go up and down completely randomly.
Pair Corralation between Taokaenoi Food and Vibhavadi Medical
Assuming the 90 days trading horizon Taokaenoi Food is expected to generate 1.0 times less return on investment than Vibhavadi Medical. In addition to that, Taokaenoi Food is 1.0 times more volatile than Vibhavadi Medical Center. It trades about 0.04 of its total potential returns per unit of risk. Vibhavadi Medical Center is currently generating about 0.04 per unit of volatility. If you would invest 251.00 in Vibhavadi Medical Center on September 14, 2024 and sell it today you would lose (41.00) from holding Vibhavadi Medical Center or give up 16.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Taokaenoi Food Marketing vs. Vibhavadi Medical Center
Performance |
| Timeline |
| Taokaenoi Food Marketing |
| Vibhavadi Medical Center |
Taokaenoi Food and Vibhavadi Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taokaenoi Food and Vibhavadi Medical
The main advantage of trading using opposite Taokaenoi Food and Vibhavadi Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taokaenoi Food position performs unexpectedly, Vibhavadi Medical 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 Vibhavadi Medical will offset losses from the drop in Vibhavadi Medical's long position.| Taokaenoi Food vs. CP ALL Public | Taokaenoi Food vs. Carabao Group Public | Taokaenoi Food vs. Thai Union Group | Taokaenoi Food vs. Minor International Public |
| Vibhavadi Medical vs. Chularat Hospital Public | Vibhavadi Medical vs. Bangkok Chain Hospital | Vibhavadi Medical vs. Bangkok Dusit Medical | Vibhavadi Medical vs. Bumrungrad Hospital 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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