Correlation Between Jay Mart and Thai OPP

Can any of the company-specific risk be diversified away by investing in both Jay Mart and Thai OPP 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 Jay Mart and Thai OPP into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jay Mart Public and Thai OPP Public, you can compare the effects of market volatilities on Jay Mart and Thai OPP 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 Jay Mart with a short position of Thai OPP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jay Mart and Thai OPP.

Diversification Opportunities for Jay Mart and Thai OPP

0.42

Correlation Coefficient

Jay Mart  Thai OPP

Very weak diversification

The 3 months correlation between Jay and Thai is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Jay Mart Public and Thai OPP Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai OPP Public and Jay Mart 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 Jay Mart Public are associated (or correlated) with Thai OPP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai OPP Public has no effect on the direction of Jay Mart i.e., Jay Mart and Thai OPP go up and down completely randomly.

Pair Corralation between Jay Mart and Thai OPP

Assuming the 90 days trading horizon Jay Mart Public is expected to generate 116.19 times more return on investment than Thai OPP. However, Jay Mart is 116.19 times more volatile than Thai OPP Public. It trades about 0.13 of its potential returns per unit of risk. Thai OPP Public is currently generating about -0.11 per unit of risk. If you would invest  1,365  in Jay Mart Public on December 3, 2024 and sell it today you would lose (325.00) from holding Jay Mart Public or give up 23.81% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	74.58%
Values	Daily Returns

Jay Mart Public  vs.  Thai OPP Public

Jay Mart Public

Risk-Adjusted Performance

OK

Over the last 90 days Jay Mart Public has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively conflicting basic indicators, Jay Mart reported solid returns over the last few months and may actually be approaching a breakup point.

Thai OPP Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Thai OPP Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Jay Mart and Thai OPP

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

The idea behind Jay Mart Public and Thai OPP Public 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.

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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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.