Correlation Between THAI BEVERAGE and Sun Art
Can any of the company-specific risk be diversified away by investing in both THAI BEVERAGE and Sun Art 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 THAI BEVERAGE and Sun Art into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between THAI BEVERAGE and Sun Art Retail, you can compare the effects of market volatilities on THAI BEVERAGE and Sun Art 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 THAI BEVERAGE with a short position of Sun Art. Check out your portfolio center. Please also check ongoing floating volatility patterns of THAI BEVERAGE and Sun Art.
Diversification Opportunities for THAI BEVERAGE and Sun Art
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between THAI and Sun is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding THAI BEVERAGE and Sun Art Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Art Retail and THAI BEVERAGE 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 THAI BEVERAGE are associated (or correlated) with Sun Art. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Art Retail has no effect on the direction of THAI BEVERAGE i.e., THAI BEVERAGE and Sun Art go up and down completely randomly.
Pair Corralation between THAI BEVERAGE and Sun Art
Assuming the 90 days trading horizon THAI BEVERAGE is expected to under-perform the Sun Art. But the stock apears to be less risky and, when comparing its historical volatility, THAI BEVERAGE is 7.36 times less risky than Sun Art. The stock trades about -0.04 of its potential returns per unit of risk. The Sun Art Retail is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 14.00 in Sun Art Retail on December 18, 2024 and sell it today you would earn a total of 9.00 from holding Sun Art Retail or generate 64.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
THAI BEVERAGE vs. Sun Art Retail
Performance |
Timeline |
THAI BEVERAGE |
Sun Art Retail |
THAI BEVERAGE and Sun Art Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with THAI BEVERAGE and Sun Art
The main advantage of trading using opposite THAI BEVERAGE and Sun Art positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if THAI BEVERAGE position performs unexpectedly, Sun Art 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 Sun Art will offset losses from the drop in Sun Art's long position.THAI BEVERAGE vs. ANTA Sports Products | THAI BEVERAGE vs. USWE SPORTS AB | THAI BEVERAGE vs. Nucletron Electronic Aktiengesellschaft | THAI BEVERAGE vs. United Microelectronics Corp |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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