Correlation Between Thai Beverage and SIVERS SEMICONDUCTORS

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

By analyzing existing cross correlation between Thai Beverage Public and SIVERS SEMICONDUCTORS AB, you can compare the effects of market volatilities on Thai Beverage and SIVERS SEMICONDUCTORS 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 SIVERS SEMICONDUCTORS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Beverage and SIVERS SEMICONDUCTORS.

Diversification Opportunities for Thai Beverage and SIVERS SEMICONDUCTORS

-0.26

Correlation Coefficient

Thai Beverage  SIVERS SEMICONDUCTORS

Very good diversification

The 3 months correlation between Thai and SIVERS is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage Public and SIVERS SEMICONDUCTORS AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SIVERS SEMICONDUCTORS 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 Public are associated (or correlated) with SIVERS SEMICONDUCTORS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SIVERS SEMICONDUCTORS has no effect on the direction of Thai Beverage i.e., Thai Beverage and SIVERS SEMICONDUCTORS go up and down completely randomly.

Pair Corralation between Thai Beverage and SIVERS SEMICONDUCTORS

Assuming the 90 days horizon Thai Beverage is expected to generate 1.03 times less return on investment than SIVERS SEMICONDUCTORS. But when comparing it to its historical volatility, Thai Beverage Public is 4.25 times less risky than SIVERS SEMICONDUCTORS. It trades about 0.09 of its potential returns per unit of risk. SIVERS SEMICONDUCTORS AB is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  30.00  in SIVERS SEMICONDUCTORS AB on October 9, 2024 and sell it today you would lose (5.00) from holding SIVERS SEMICONDUCTORS AB or give up 16.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Thai Beverage Public  vs.  SIVERS SEMICONDUCTORS AB

Thai Beverage Public

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Thai Beverage Public are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Thai Beverage reported solid returns over the last few months and may actually be approaching a breakup point.

SIVERS SEMICONDUCTORS

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Thai Beverage and SIVERS SEMICONDUCTORS

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

The idea behind Thai Beverage Public and SIVERS SEMICONDUCTORS AB 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.