Correlation Between Thai Life and Thai Union
Can any of the company-specific risk be diversified away by investing in both Thai Life and Thai Union 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 Thai Union 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 Thai Union Group, you can compare the effects of market volatilities on Thai Life and Thai Union 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 Thai Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Life and Thai Union.
Diversification Opportunities for Thai Life and Thai Union
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Thai and Thai is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Thai Life Insurance and Thai Union Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Union Group 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 Thai Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Union Group has no effect on the direction of Thai Life i.e., Thai Life and Thai Union go up and down completely randomly.
Pair Corralation between Thai Life and Thai Union
Assuming the 90 days trading horizon Thai Life Insurance is expected to under-perform the Thai Union. But the stock apears to be less risky and, when comparing its historical volatility, Thai Life Insurance is 23.06 times less risky than Thai Union. The stock trades about -0.02 of its potential returns per unit of risk. The Thai Union Group is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,544 in Thai Union Group on September 2, 2024 and sell it today you would lose (174.00) from holding Thai Union Group or give up 11.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thai Life Insurance vs. Thai Union Group
Performance |
| Timeline |
| Thai Life Insurance |
| Thai Union Group |
Thai Life and Thai Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Life and Thai Union
The main advantage of trading using opposite Thai Life and Thai Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Life position performs unexpectedly, Thai Union 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 Thai Union will offset losses from the drop in Thai Union's long position.| Thai Life vs. PTT Oil and | Thai Life vs. Home Product Center | Thai Life vs. Muangthai Capital Public | Thai Life vs. The Erawan Group |
| Thai Union vs. MK Restaurant Group | Thai Union vs. TRC Construction Public | Thai Union vs. Bangkok Expressway and | Thai Union vs. Lohakit Metal 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |