Correlation Between Thai Textile and TPCS Public
Can any of the company-specific risk be diversified away by investing in both Thai Textile and TPCS Public 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 Textile and TPCS Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Textile Industry and TPCS Public, you can compare the effects of market volatilities on Thai Textile and TPCS Public 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 Textile with a short position of TPCS Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Textile and TPCS Public.
Diversification Opportunities for Thai Textile and TPCS Public
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Thai and TPCS is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Thai Textile Industry and TPCS Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TPCS Public and Thai Textile 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 Textile Industry are associated (or correlated) with TPCS Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TPCS Public has no effect on the direction of Thai Textile i.e., Thai Textile and TPCS Public go up and down completely randomly.
Pair Corralation between Thai Textile and TPCS Public
Assuming the 90 days trading horizon Thai Textile is expected to generate 3.38 times less return on investment than TPCS Public. But when comparing it to its historical volatility, Thai Textile Industry is 1.47 times less risky than TPCS Public. It trades about 0.08 of its potential returns per unit of risk. TPCS Public is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,090 in TPCS Public on November 3, 2024 and sell it today you would earn a total of 120.00 from holding TPCS Public or generate 11.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thai Textile Industry vs. TPCS Public
Performance |
| Timeline |
| Thai Textile Industry |
| TPCS Public |
Thai Textile and TPCS Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Textile and TPCS Public
The main advantage of trading using opposite Thai Textile and TPCS Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Textile position performs unexpectedly, TPCS Public 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 TPCS Public will offset losses from the drop in TPCS Public's long position.| Thai Textile vs. Thanulux Public | Thai Textile vs. Union Pioneer Public | Thai Textile vs. Thai Rayon Public | Thai Textile vs. Thai Rung Union |
| TPCS Public vs. Thai Textile Industry | TPCS Public vs. Toray Textiles Public | TPCS Public vs. Siam Steel Service | TPCS Public vs. Trinity Watthana 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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