Correlation Between Thai Metal and Trinity Watthana
Can any of the company-specific risk be diversified away by investing in both Thai Metal and Trinity Watthana 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 Metal and Trinity Watthana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Metal Drum and Trinity Watthana Public, you can compare the effects of market volatilities on Thai Metal and Trinity Watthana 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 Metal with a short position of Trinity Watthana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Metal and Trinity Watthana.
Diversification Opportunities for Thai Metal and Trinity Watthana
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Thai and Trinity is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Thai Metal Drum and Trinity Watthana Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trinity Watthana Public and Thai Metal 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 Metal Drum are associated (or correlated) with Trinity Watthana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trinity Watthana Public has no effect on the direction of Thai Metal i.e., Thai Metal and Trinity Watthana go up and down completely randomly.
Pair Corralation between Thai Metal and Trinity Watthana
Assuming the 90 days trading horizon Thai Metal Drum is expected to generate 0.47 times more return on investment than Trinity Watthana. However, Thai Metal Drum is 2.12 times less risky than Trinity Watthana. It trades about 0.07 of its potential returns per unit of risk. Trinity Watthana Public is currently generating about -0.49 per unit of risk. If you would invest 2,430 in Thai Metal Drum on November 3, 2024 and sell it today you would earn a total of 40.00 from holding Thai Metal Drum or generate 1.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Thai Metal Drum vs. Trinity Watthana Public
Performance |
| Timeline |
| Thai Metal Drum |
| Trinity Watthana Public |
Thai Metal and Trinity Watthana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Metal and Trinity Watthana
The main advantage of trading using opposite Thai Metal and Trinity Watthana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Metal position performs unexpectedly, Trinity Watthana 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 Trinity Watthana will offset losses from the drop in Trinity Watthana's long position.| Thai Metal vs. Thantawan Industry Public | Thai Metal vs. Thitikorn Public | Thai Metal vs. Siam Steel Service | Thai Metal vs. Thai Vegetable Oil |
| Trinity Watthana vs. Asia Plus Group | Trinity Watthana vs. Thitikorn Public | Trinity Watthana vs. TISCO Financial Group | Trinity Watthana vs. KGI Securities 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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