Correlation Between Thoresen Thai and CPR Gomu
Can any of the company-specific risk be diversified away by investing in both Thoresen Thai and CPR Gomu 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 Thoresen Thai and CPR Gomu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thoresen Thai Agencies and CPR Gomu Industrial, you can compare the effects of market volatilities on Thoresen Thai and CPR Gomu 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 Thoresen Thai with a short position of CPR Gomu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thoresen Thai and CPR Gomu.
Diversification Opportunities for Thoresen Thai and CPR Gomu
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Thoresen and CPR is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Thoresen Thai Agencies and CPR Gomu Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CPR Gomu Industrial and Thoresen Thai 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 Thoresen Thai Agencies are associated (or correlated) with CPR Gomu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CPR Gomu Industrial has no effect on the direction of Thoresen Thai i.e., Thoresen Thai and CPR Gomu go up and down completely randomly.
Pair Corralation between Thoresen Thai and CPR Gomu
Assuming the 90 days trading horizon Thoresen Thai Agencies is expected to generate 1.21 times more return on investment than CPR Gomu. However, Thoresen Thai is 1.21 times more volatile than CPR Gomu Industrial. It trades about 0.04 of its potential returns per unit of risk. CPR Gomu Industrial is currently generating about -0.16 per unit of risk. If you would invest 456.00 in Thoresen Thai Agencies on November 27, 2024 and sell it today you would earn a total of 6.00 from holding Thoresen Thai Agencies or generate 1.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thoresen Thai Agencies vs. CPR Gomu Industrial
Performance |
| Timeline |
| Thoresen Thai Agencies |
| CPR Gomu Industrial |
Thoresen Thai and CPR Gomu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thoresen Thai and CPR Gomu
The main advantage of trading using opposite Thoresen Thai and CPR Gomu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thoresen Thai position performs unexpectedly, CPR Gomu 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 CPR Gomu will offset losses from the drop in CPR Gomu's long position.| Thoresen Thai vs. Precious Shipping Public | Thoresen Thai vs. Regional Container Lines | Thoresen Thai vs. PTT Public | Thoresen Thai vs. The Siam Cement |
| CPR Gomu vs. Salee Colour Public | CPR Gomu vs. Business Online PCL | CPR Gomu vs. Communication System Solution | CPR Gomu vs. CI Group 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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