Correlation Between Haad Thip and Fine Metal

Can any of the company-specific risk be diversified away by investing in both Haad Thip and Fine Metal 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 Haad Thip and Fine Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Haad Thip Public and Fine Metal Technologies, you can compare the effects of market volatilities on Haad Thip and Fine Metal 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 Haad Thip with a short position of Fine Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Haad Thip and Fine Metal.

Diversification Opportunities for Haad Thip and Fine Metal

0.23

Correlation Coefficient

Haad Thip  Fine Metal

Modest diversification

The 3 months correlation between Haad and Fine is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Haad Thip Public and Fine Metal Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fine Metal Technologies and Haad Thip 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 Haad Thip Public are associated (or correlated) with Fine Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fine Metal Technologies has no effect on the direction of Haad Thip i.e., Haad Thip and Fine Metal go up and down completely randomly.

Pair Corralation between Haad Thip and Fine Metal

Assuming the 90 days trading horizon Haad Thip is expected to generate 160.42 times less return on investment than Fine Metal. But when comparing it to its historical volatility, Haad Thip Public is 87.71 times less risky than Fine Metal. It trades about 0.07 of its potential returns per unit of risk. Fine Metal Technologies is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  0.00  in Fine Metal Technologies on September 3, 2024 and sell it today you would earn a total of  3,325  from holding Fine Metal Technologies or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Haad Thip Public  vs.  Fine Metal Technologies

Haad Thip Public

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Haad Thip Public are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent fundamental indicators, Haad Thip is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Fine Metal Technologies

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fine Metal Technologies are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Fine Metal disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Haad Thip and Fine Metal

The main advantage of trading using opposite Haad Thip and Fine Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haad Thip position performs unexpectedly, Fine Metal 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 Fine Metal will offset losses from the drop in Fine Metal's long position.

The idea behind Haad Thip Public and Fine Metal Technologies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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.