Correlation Between TRV Rubber and Asia Medical
Can any of the company-specific risk be diversified away by investing in both TRV Rubber and Asia 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 TRV Rubber and Asia Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TRV Rubber Products and Asia Medical Agricultural, you can compare the effects of market volatilities on TRV Rubber and Asia 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 TRV Rubber with a short position of Asia Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRV Rubber and Asia Medical.
Diversification Opportunities for TRV Rubber and Asia Medical
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between TRV and Asia is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding TRV Rubber Products and Asia Medical Agricultural in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Medical Agricultural and TRV Rubber 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 TRV Rubber Products are associated (or correlated) with Asia Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Medical Agricultural has no effect on the direction of TRV Rubber i.e., TRV Rubber and Asia Medical go up and down completely randomly.
Pair Corralation between TRV Rubber and Asia Medical
Assuming the 90 days trading horizon TRV Rubber Products is expected to under-perform the Asia Medical. In addition to that, TRV Rubber is 1.64 times more volatile than Asia Medical Agricultural. It trades about -0.01 of its total potential returns per unit of risk. Asia Medical Agricultural is currently generating about 0.04 per unit of volatility. If you would invest 119.00 in Asia Medical Agricultural on September 3, 2024 and sell it today you would earn a total of 22.00 from holding Asia Medical Agricultural or generate 18.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 92.92% |
| Values | Daily Returns |
TRV Rubber Products vs. Asia Medical Agricultural
Performance |
| Timeline |
| TRV Rubber Products |
| Asia Medical Agricultural |
TRV Rubber and Asia Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TRV Rubber and Asia Medical
The main advantage of trading using opposite TRV Rubber and Asia Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TRV Rubber position performs unexpectedly, Asia 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 Asia Medical will offset losses from the drop in Asia Medical's long position.| TRV Rubber vs. PMC LABEL MATERIALS | TRV Rubber vs. Charoen Pokphand Foods | TRV Rubber vs. Sri panwa Hospitality | TRV Rubber vs. Ramkhamhaeng Hospital Public |
| Asia Medical vs. Asian Alliance International | Asia Medical vs. International Network System | Asia Medical vs. The Klinique Med | Asia Medical vs. Exotic Food 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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