Correlation Between Thai Union and WHA Public
Can any of the company-specific risk be diversified away by investing in both Thai Union and WHA 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 Union and WHA Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Union Group and WHA Public, you can compare the effects of market volatilities on Thai Union and WHA 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 Union with a short position of WHA Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Union and WHA Public.
Diversification Opportunities for Thai Union and WHA Public
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Thai and WHA is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Thai Union Group and WHA Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WHA Public and Thai Union 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 Union Group are associated (or correlated) with WHA Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WHA Public has no effect on the direction of Thai Union i.e., Thai Union and WHA Public go up and down completely randomly.
Pair Corralation between Thai Union and WHA Public
Assuming the 90 days trading horizon Thai Union Group is expected to generate 42.65 times more return on investment than WHA Public. However, Thai Union is 42.65 times more volatile than WHA Public. It trades about 0.07 of its potential returns per unit of risk. WHA Public is currently generating about 0.06 per unit of risk. If you would invest 1,371 in Thai Union Group on August 27, 2024 and sell it today you would lose (1.00) from holding Thai Union Group or give up 0.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thai Union Group vs. WHA Public
Performance |
| Timeline |
| Thai Union Group |
| WHA Public |
Thai Union and WHA Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Union and WHA Public
The main advantage of trading using opposite Thai Union and WHA Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Union position performs unexpectedly, WHA 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 WHA Public will offset losses from the drop in WHA Public's long position.| Thai Union vs. Chamni Eye PCL | Thai Union vs. Siam Global House | Thai Union vs. The Erawan Group | Thai Union vs. Ditto Public |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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