Correlation Between Techno Agricultural and Pha Lai
Can any of the company-specific risk be diversified away by investing in both Techno Agricultural and Pha Lai 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 Techno Agricultural and Pha Lai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Techno Agricultural Supplying and Pha Lai Thermal, you can compare the effects of market volatilities on Techno Agricultural and Pha Lai 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 Techno Agricultural with a short position of Pha Lai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Techno Agricultural and Pha Lai.
Diversification Opportunities for Techno Agricultural and Pha Lai
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Techno and Pha is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Techno Agricultural Supplying and Pha Lai Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pha Lai Thermal and Techno Agricultural 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 Techno Agricultural Supplying are associated (or correlated) with Pha Lai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pha Lai Thermal has no effect on the direction of Techno Agricultural i.e., Techno Agricultural and Pha Lai go up and down completely randomly.
Pair Corralation between Techno Agricultural and Pha Lai
Assuming the 90 days trading horizon Techno Agricultural Supplying is expected to under-perform the Pha Lai. In addition to that, Techno Agricultural is 1.5 times more volatile than Pha Lai Thermal. It trades about -0.03 of its total potential returns per unit of risk. Pha Lai Thermal is currently generating about 0.02 per unit of volatility. If you would invest 1,033,339 in Pha Lai Thermal on August 29, 2024 and sell it today you would earn a total of 81,661 from holding Pha Lai Thermal or generate 7.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Techno Agricultural Supplying vs. Pha Lai Thermal
Performance |
| Timeline |
| Techno Agricultural |
| Pha Lai Thermal |
Techno Agricultural and Pha Lai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Techno Agricultural and Pha Lai
The main advantage of trading using opposite Techno Agricultural and Pha Lai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Techno Agricultural position performs unexpectedly, Pha Lai 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 Pha Lai will offset losses from the drop in Pha Lai's long position.| Techno Agricultural vs. FIT INVEST JSC | Techno Agricultural vs. Damsan JSC | Techno Agricultural vs. An Phat Plastic | Techno Agricultural vs. Alphanam ME |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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