Correlation Between Samart Digital and Cho Thavee

Can any of the company-specific risk be diversified away by investing in both Samart Digital and Cho Thavee 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 Samart Digital and Cho Thavee into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Samart Digital and Cho Thavee

0.25

Correlation Coefficient

Samart Digital  Cho Thavee

Modest diversification

The 3 months correlation between Samart and Cho is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Samart Digital Public and Cho Thavee Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cho Thavee Public and Samart Digital 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 Samart Digital Public are associated (or correlated) with Cho Thavee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cho Thavee Public has no effect on the direction of Samart Digital i.e., Samart Digital and Cho Thavee go up and down completely randomly.

Pair Corralation between Samart Digital and Cho Thavee

Assuming the 90 days trading horizon Samart Digital Public is expected to generate 0.83 times more return on investment than Cho Thavee. However, Samart Digital Public is 1.21 times less risky than Cho Thavee. It trades about 0.06 of its potential returns per unit of risk. Cho Thavee Public is currently generating about 0.03 per unit of risk. If you would invest  4.00  in Samart Digital Public on December 29, 2024 and sell it today you would earn a total of  0.00  from holding Samart Digital Public or generate 0.0% return on investment over 90 days.

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

Samart Digital Public  vs.  Cho Thavee Public

Samart Digital Public

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Samart Digital Public are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental indicators, Samart Digital disclosed solid returns over the last few months and may actually be approaching a breakup point.

Cho Thavee Public

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cho Thavee Public are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Cho Thavee disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Samart Digital and Cho Thavee

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

The idea behind Samart Digital Public and Cho Thavee 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.

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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.