Correlation Between Thai Union and JD Food
Can any of the company-specific risk be diversified away by investing in both Thai Union and JD Food 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 JD Food 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 JD Food PCL, you can compare the effects of market volatilities on Thai Union and JD Food 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 JD Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Union and JD Food.
Diversification Opportunities for Thai Union and JD Food
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Thai and JDF is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Thai Union Group and JD Food PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JD Food 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 JD Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JD Food PCL has no effect on the direction of Thai Union i.e., Thai Union and JD Food go up and down completely randomly.
Pair Corralation between Thai Union and JD Food
Assuming the 90 days horizon Thai Union Group is expected to generate 20.61 times more return on investment than JD Food. However, Thai Union is 20.61 times more volatile than JD Food PCL. It trades about 0.04 of its potential returns per unit of risk. JD Food PCL is currently generating about -0.03 per unit of risk. If you would invest 1,544 in Thai Union Group on September 2, 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. JD Food PCL
Performance |
| Timeline |
| Thai Union Group |
| JD Food PCL |
Thai Union and JD Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Union and JD Food
The main advantage of trading using opposite Thai Union and JD Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Union position performs unexpectedly, JD Food 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 JD Food will offset losses from the drop in JD Food's long position.| Thai Union vs. MK Restaurant Group | Thai Union vs. TRC Construction Public | Thai Union vs. Bangkok Expressway and | Thai Union vs. Lohakit Metal Public |
| JD Food vs. Warrix Sport PCL | JD Food vs. Bumrungrad Hospital Public | JD Food vs. S Hotels and | JD Food vs. Bhiraj Office Leasehold |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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