Correlation Between VGI Public and POSCO Thainox
Can any of the company-specific risk be diversified away by investing in both VGI Public and POSCO Thainox 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 VGI Public and POSCO Thainox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VGI Public and POSCO Thainox Public, you can compare the effects of market volatilities on VGI Public and POSCO Thainox 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 VGI Public with a short position of POSCO Thainox. Check out your portfolio center. Please also check ongoing floating volatility patterns of VGI Public and POSCO Thainox.
Diversification Opportunities for VGI Public and POSCO Thainox
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between VGI and POSCO is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding VGI Public and POSCO Thainox Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on POSCO Thainox Public and VGI Public 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 VGI Public are associated (or correlated) with POSCO Thainox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of POSCO Thainox Public has no effect on the direction of VGI Public i.e., VGI Public and POSCO Thainox go up and down completely randomly.
Pair Corralation between VGI Public and POSCO Thainox
If you would invest 286.00 in VGI Public on August 30, 2024 and sell it today you would earn a total of 0.00 from holding VGI Public or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
VGI Public vs. POSCO Thainox Public
Performance |
| Timeline |
| VGI Public |
| POSCO Thainox Public |
VGI Public and POSCO Thainox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VGI Public and POSCO Thainox
The main advantage of trading using opposite VGI Public and POSCO Thainox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VGI Public position performs unexpectedly, POSCO Thainox 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 POSCO Thainox will offset losses from the drop in POSCO Thainox's long position.| VGI Public vs. Quality Houses Hotel | VGI Public vs. Quality Houses Property | VGI Public vs. CK Power Public | VGI Public vs. Thai Metal Drum |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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