Correlation Between Sapiens International and Thai Oil

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

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

Diversification Opportunities for Sapiens International and Thai Oil

0.0

Correlation Coefficient

Sapiens International  Thai Oil

Pay attention - limited upside

The 3 months correlation between Sapiens and Thai is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Sapiens International and Thai Oil Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Oil Public and Sapiens International 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 Sapiens International are associated (or correlated) with Thai Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Oil Public has no effect on the direction of Sapiens International i.e., Sapiens International and Thai Oil go up and down completely randomly.

Pair Corralation between Sapiens International and Thai Oil

Given the investment horizon of 90 days Sapiens International is expected to generate 1.16 times more return on investment than Thai Oil. However, Sapiens International is 1.16 times more volatile than Thai Oil Public. It trades about 0.02 of its potential returns per unit of risk. Thai Oil Public is currently generating about 0.01 per unit of risk. If you would invest  2,202  in Sapiens International on October 13, 2024 and sell it today you would earn a total of  328.00  from holding Sapiens International or generate 14.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	42.94%
Values	Daily Returns

Sapiens International  vs.  Thai Oil Public

Sapiens International

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Sapiens International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Thai Oil Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thai Oil Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Thai Oil is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Sapiens International and Thai Oil

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

The idea behind Sapiens International and Thai Oil 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.