Correlation Between WICE Logistics and Triple I
Can any of the company-specific risk be diversified away by investing in both WICE Logistics and Triple I 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 WICE Logistics and Triple I into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WICE Logistics PCL and Triple i Logistics, you can compare the effects of market volatilities on WICE Logistics and Triple I 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 WICE Logistics with a short position of Triple I. Check out your portfolio center. Please also check ongoing floating volatility patterns of WICE Logistics and Triple I.
Diversification Opportunities for WICE Logistics and Triple I
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between WICE and Triple is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding WICE Logistics PCL and Triple i Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triple i Logistics and WICE Logistics 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 WICE Logistics PCL are associated (or correlated) with Triple I. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triple i Logistics has no effect on the direction of WICE Logistics i.e., WICE Logistics and Triple I go up and down completely randomly.
Pair Corralation between WICE Logistics and Triple I
Assuming the 90 days trading horizon WICE Logistics PCL is expected to under-perform the Triple I. But the stock apears to be less risky and, when comparing its historical volatility, WICE Logistics PCL is 24.29 times less risky than Triple I. The stock trades about -0.01 of its potential returns per unit of risk. The Triple i Logistics is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 968.00 in Triple i Logistics on September 2, 2024 and sell it today you would lose (398.00) from holding Triple i Logistics or give up 41.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WICE Logistics PCL vs. Triple i Logistics
Performance |
| Timeline |
| WICE Logistics PCL |
| Triple i Logistics |
WICE Logistics and Triple I Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WICE Logistics and Triple I
The main advantage of trading using opposite WICE Logistics and Triple I positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WICE Logistics position performs unexpectedly, Triple I 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 Triple I will offset losses from the drop in Triple I's long position.| WICE Logistics vs. Gulf Energy Development | WICE Logistics vs. Energy Absolute Public | WICE Logistics vs. WHA Public | WICE Logistics vs. Bangkok Expressway and |
| Triple I vs. Gulf Energy Development | Triple I vs. Energy Absolute Public | Triple I vs. WHA Public | Triple I vs. Bangkok Expressway and |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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