Correlation Between Thai Vegetable and Srinanaporn Marketing
Can any of the company-specific risk be diversified away by investing in both Thai Vegetable and Srinanaporn Marketing 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 Vegetable and Srinanaporn Marketing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Vegetable Oil and Srinanaporn Marketing Public, you can compare the effects of market volatilities on Thai Vegetable and Srinanaporn Marketing 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 Vegetable with a short position of Srinanaporn Marketing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Vegetable and Srinanaporn Marketing.
Diversification Opportunities for Thai Vegetable and Srinanaporn Marketing
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thai and Srinanaporn is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Thai Vegetable Oil and Srinanaporn Marketing Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Srinanaporn Marketing and Thai Vegetable 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 Vegetable Oil are associated (or correlated) with Srinanaporn Marketing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Srinanaporn Marketing has no effect on the direction of Thai Vegetable i.e., Thai Vegetable and Srinanaporn Marketing go up and down completely randomly.
Pair Corralation between Thai Vegetable and Srinanaporn Marketing
Assuming the 90 days trading horizon Thai Vegetable Oil is expected to generate 0.65 times more return on investment than Srinanaporn Marketing. However, Thai Vegetable Oil is 1.55 times less risky than Srinanaporn Marketing. It trades about 0.05 of its potential returns per unit of risk. Srinanaporn Marketing Public is currently generating about 0.02 per unit of risk. If you would invest 1,997 in Thai Vegetable Oil on October 21, 2024 and sell it today you would earn a total of 133.00 from holding Thai Vegetable Oil or generate 6.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thai Vegetable Oil vs. Srinanaporn Marketing Public
Performance |
| Timeline |
| Thai Vegetable Oil |
| Srinanaporn Marketing |
Thai Vegetable and Srinanaporn Marketing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thai Vegetable and Srinanaporn Marketing
The main advantage of trading using opposite Thai Vegetable and Srinanaporn Marketing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Vegetable position performs unexpectedly, Srinanaporn Marketing 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 Srinanaporn Marketing will offset losses from the drop in Srinanaporn Marketing's long position.| Thai Vegetable vs. Charoen Pokphand Foods | Thai Vegetable vs. Thai Union Group | Thai Vegetable vs. TISCO Financial Group | Thai Vegetable vs. Thanachart Capital Public |
| Srinanaporn Marketing vs. Sappe Public | Srinanaporn Marketing vs. Osotspa Public | Srinanaporn Marketing vs. RB Food Supply | Srinanaporn Marketing vs. Sabuy Technology 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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