Correlation Between Thai Union and Com7 PCL
Can any of the company-specific risk be diversified away by investing in both Thai Union and Com7 PCL 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 Com7 PCL 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 Com7 PCL, you can compare the effects of market volatilities on Thai Union and Com7 PCL 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 Com7 PCL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Union and Com7 PCL.
Diversification Opportunities for Thai Union and Com7 PCL
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Thai and Com7 is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Thai Union Group and Com7 PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Com7 PCL 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 Com7 PCL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Com7 PCL has no effect on the direction of Thai Union i.e., Thai Union and Com7 PCL go up and down completely randomly.
Pair Corralation between Thai Union and Com7 PCL
Assuming the 90 days horizon Thai Union Group is expected to generate 19.71 times more return on investment than Com7 PCL. However, Thai Union is 19.71 times more volatile than Com7 PCL. It trades about 0.04 of its potential returns per unit of risk. Com7 PCL is currently generating about 0.0 per unit of risk. If you would invest 1,544 in Thai Union Group on September 3, 2024 and sell it today you would lose (174.00) from holding Thai Union Group or give up 11.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thai Union Group vs. Com7 PCL
Performance |
| Timeline |
| Thai Union Group |
| Com7 PCL |
Thai Union and Com7 PCL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Union and Com7 PCL
The main advantage of trading using opposite Thai Union and Com7 PCL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Union position performs unexpectedly, Com7 PCL 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 Com7 PCL will offset losses from the drop in Com7 PCL's long position.| Thai Union vs. Charoen Pokphand Foods | Thai Union vs. CP ALL Public | Thai Union vs. Minor International Public | Thai Union vs. Advanced Info Service |
| Com7 PCL vs. Central Pattana Public | Com7 PCL vs. CP ALL Public | Com7 PCL vs. Bangkok Dusit Medical | Com7 PCL vs. Airports of Thailand |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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