Correlation Between Thai President and Thai Reinsurance
Can any of the company-specific risk be diversified away by investing in both Thai President and Thai Reinsurance 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 President and Thai Reinsurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai President Foods and Thai Reinsurance Public, you can compare the effects of market volatilities on Thai President and Thai Reinsurance 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 President with a short position of Thai Reinsurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai President and Thai Reinsurance.
Diversification Opportunities for Thai President and Thai Reinsurance
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thai and Thai is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Thai President Foods and Thai Reinsurance Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Reinsurance Public and Thai President 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 President Foods are associated (or correlated) with Thai Reinsurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Reinsurance Public has no effect on the direction of Thai President i.e., Thai President and Thai Reinsurance go up and down completely randomly.
Pair Corralation between Thai President and Thai Reinsurance
Assuming the 90 days trading horizon Thai President Foods is expected to generate 0.22 times more return on investment than Thai Reinsurance. However, Thai President Foods is 4.59 times less risky than Thai Reinsurance. It trades about -0.1 of its potential returns per unit of risk. Thai Reinsurance Public is currently generating about -0.19 per unit of risk. If you would invest 20,445 in Thai President Foods on September 24, 2024 and sell it today you would lose (495.00) from holding Thai President Foods or give up 2.42% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Thai President Foods vs. Thai Reinsurance Public
Performance |
Timeline |
Thai President Foods |
Thai Reinsurance Public |
Thai President and Thai Reinsurance Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Thai President and Thai Reinsurance
The main advantage of trading using opposite Thai President and Thai Reinsurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai President position performs unexpectedly, Thai Reinsurance 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 Thai Reinsurance will offset losses from the drop in Thai Reinsurance's long position.Thai President vs. GFPT Public | Thai President vs. Thai Union Group | Thai President vs. Com7 PCL | Thai President vs. Ichitan Group Public |
Thai Reinsurance vs. Kasikornbank Public | Thai Reinsurance vs. PTT Public | Thai Reinsurance vs. The Siam Cement |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Commodity Directory Find actively traded commodities issued by global exchanges | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |