Correlation Between Thai Life and PINTHONG INDUSTRIAL
Can any of the company-specific risk be diversified away by investing in both Thai Life and PINTHONG INDUSTRIAL 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 Thai Life and PINTHONG INDUSTRIAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Life Insurance and PINTHONG INDUSTRIAL PARK, you can compare the effects of market volatilities on Thai Life and PINTHONG INDUSTRIAL 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 Thai Life with a short position of PINTHONG INDUSTRIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Life and PINTHONG INDUSTRIAL.
Diversification Opportunities for Thai Life and PINTHONG INDUSTRIAL
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thai and PINTHONG is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Thai Life Insurance and PINTHONG INDUSTRIAL PARK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PINTHONG INDUSTRIAL PARK and Thai 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 Thai Life Insurance are associated (or correlated) with PINTHONG INDUSTRIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PINTHONG INDUSTRIAL PARK has no effect on the direction of Thai Life i.e., Thai Life and PINTHONG INDUSTRIAL go up and down completely randomly.
Pair Corralation between Thai Life and PINTHONG INDUSTRIAL
Assuming the 90 days trading horizon Thai Life is expected to generate 4.43 times less return on investment than PINTHONG INDUSTRIAL. But when comparing it to its historical volatility, Thai Life Insurance is 1.67 times less risky than PINTHONG INDUSTRIAL. It trades about 0.03 of its potential returns per unit of risk. PINTHONG INDUSTRIAL PARK is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 398.00 in PINTHONG INDUSTRIAL PARK on September 14, 2024 and sell it today you would earn a total of 237.00 from holding PINTHONG INDUSTRIAL PARK or generate 59.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thai Life Insurance vs. PINTHONG INDUSTRIAL PARK
Performance |
| Timeline |
| Thai Life Insurance |
| PINTHONG INDUSTRIAL PARK |
Thai Life and PINTHONG INDUSTRIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Life and PINTHONG INDUSTRIAL
The main advantage of trading using opposite Thai Life and PINTHONG INDUSTRIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Life position performs unexpectedly, PINTHONG INDUSTRIAL 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 PINTHONG INDUSTRIAL will offset losses from the drop in PINTHONG INDUSTRIAL's long position.| Thai Life vs. Bangkok Life Assurance | Thai Life vs. PTT Oil and | Thai Life vs. Home Product Center | Thai Life vs. Muangthai Capital Public |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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