Correlation Between SOLSTAD OFFSHORE and TMBThanachart Bank
Can any of the company-specific risk be diversified away by investing in both SOLSTAD OFFSHORE and TMBThanachart Bank 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 SOLSTAD OFFSHORE and TMBThanachart Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SOLSTAD OFFSHORE NK and TMBThanachart Bank Public, you can compare the effects of market volatilities on SOLSTAD OFFSHORE and TMBThanachart Bank 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 SOLSTAD OFFSHORE with a short position of TMBThanachart Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of SOLSTAD OFFSHORE and TMBThanachart Bank.
Diversification Opportunities for SOLSTAD OFFSHORE and TMBThanachart Bank
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between SOLSTAD and TMBThanachart is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding SOLSTAD OFFSHORE NK and TMBThanachart Bank Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TMBThanachart Bank Public and SOLSTAD OFFSHORE 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 SOLSTAD OFFSHORE NK are associated (or correlated) with TMBThanachart Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TMBThanachart Bank Public has no effect on the direction of SOLSTAD OFFSHORE i.e., SOLSTAD OFFSHORE and TMBThanachart Bank go up and down completely randomly.
Pair Corralation between SOLSTAD OFFSHORE and TMBThanachart Bank
Assuming the 90 days horizon SOLSTAD OFFSHORE NK is expected to generate 2.56 times more return on investment than TMBThanachart Bank. However, SOLSTAD OFFSHORE is 2.56 times more volatile than TMBThanachart Bank Public. It trades about 0.12 of its potential returns per unit of risk. TMBThanachart Bank Public is currently generating about -0.04 per unit of risk. If you would invest 275.00 in SOLSTAD OFFSHORE NK on September 8, 2024 and sell it today you would earn a total of 79.00 from holding SOLSTAD OFFSHORE NK or generate 28.73% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
SOLSTAD OFFSHORE NK vs. TMBThanachart Bank Public
Performance |
Timeline |
SOLSTAD OFFSHORE |
TMBThanachart Bank Public |
SOLSTAD OFFSHORE and TMBThanachart Bank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SOLSTAD OFFSHORE and TMBThanachart Bank
The main advantage of trading using opposite SOLSTAD OFFSHORE and TMBThanachart Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SOLSTAD OFFSHORE position performs unexpectedly, TMBThanachart Bank 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 TMBThanachart Bank will offset losses from the drop in TMBThanachart Bank's long position.SOLSTAD OFFSHORE vs. AP Mller | SOLSTAD OFFSHORE vs. BW LPG Limited | SOLSTAD OFFSHORE vs. Superior Plus Corp | SOLSTAD OFFSHORE vs. Origin Agritech |
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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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