Correlation Between Thai Union and GFPT Public
Can any of the company-specific risk be diversified away by investing in both Thai Union and GFPT 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 GFPT 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 GFPT Public, you can compare the effects of market volatilities on Thai Union and GFPT 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 GFPT Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Union and GFPT Public.
Diversification Opportunities for Thai Union and GFPT Public
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Thai and GFPT is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Thai Union Group and GFPT Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GFPT 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 GFPT Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GFPT Public has no effect on the direction of Thai Union i.e., Thai Union and GFPT Public go up and down completely randomly.
Pair Corralation between Thai Union and GFPT Public
Assuming the 90 days horizon Thai Union Group is expected to under-perform the GFPT Public. But the stock apears to be less risky and, when comparing its historical volatility, Thai Union Group is 1.06 times less risky than GFPT Public. The stock trades about -0.28 of its potential returns per unit of risk. The GFPT Public is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 1,140 in GFPT Public on August 28, 2024 and sell it today you would lose (60.00) from holding GFPT Public or give up 5.26% 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. GFPT Public
Performance |
| Timeline |
| Thai Union Group |
| GFPT Public |
Thai Union and GFPT Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Union and GFPT Public
The main advantage of trading using opposite Thai Union and GFPT Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Union position performs unexpectedly, GFPT 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 GFPT Public will offset losses from the drop in GFPT Public'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 |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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