Correlation Between Thai Beverage and CITIC SECURITIES-H-

Can any of the company-specific risk be diversified away by investing in both Thai Beverage and CITIC SECURITIES-H- 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 CITIC SECURITIES-H- 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 CITIC SECURITIES H , you can compare the effects of market volatilities on Thai Beverage and CITIC SECURITIES-H- 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 CITIC SECURITIES-H-. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Beverage and CITIC SECURITIES-H-.

Diversification Opportunities for Thai Beverage and CITIC SECURITIES-H-

0.15

Correlation Coefficient

Thai Beverage  CITIC SECURITIES-H-

Average diversification

The 3 months correlation between Thai and CITIC is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage Public and CITIC SECURITIES H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CITIC SECURITIES-H- 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 CITIC SECURITIES-H-. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CITIC SECURITIES-H- has no effect on the direction of Thai Beverage i.e., Thai Beverage and CITIC SECURITIES-H- go up and down completely randomly.

Pair Corralation between Thai Beverage and CITIC SECURITIES-H-

Assuming the 90 days horizon Thai Beverage Public is expected to generate 1.22 times more return on investment than CITIC SECURITIES-H-. However, Thai Beverage is 1.22 times more volatile than CITIC SECURITIES H . It trades about 0.11 of its potential returns per unit of risk. CITIC SECURITIES H is currently generating about -0.21 per unit of risk. If you would invest  38.00  in Thai Beverage Public on October 10, 2024 and sell it today you would earn a total of  2.00  from holding Thai Beverage Public or generate 5.26% return on investment over 90 days.

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

Thai Beverage Public  vs.  CITIC SECURITIES H

Thai Beverage Public

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Thai Beverage Public are ranked lower than 6 (%) 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.

CITIC SECURITIES-H-

Risk-Adjusted Performance

3 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CITIC SECURITIES H are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, CITIC SECURITIES-H- may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Thai Beverage and CITIC SECURITIES-H-

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

The idea behind Thai Beverage Public and CITIC SECURITIES H 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 Global Correlations module to find global opportunities by holding instruments from different markets.