Correlation Between Thai Beverage and ReAlpha Tech
Can any of the company-specific risk be diversified away by investing in both Thai Beverage and ReAlpha Tech 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 ReAlpha Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai Beverage PCL and reAlpha Tech Corp, you can compare the effects of market volatilities on Thai Beverage and ReAlpha Tech 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 ReAlpha Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Beverage and ReAlpha Tech.
Diversification Opportunities for Thai Beverage and ReAlpha Tech
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Thai and ReAlpha is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage PCL and reAlpha Tech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on reAlpha Tech Corp 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 PCL are associated (or correlated) with ReAlpha Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of reAlpha Tech Corp has no effect on the direction of Thai Beverage i.e., Thai Beverage and ReAlpha Tech go up and down completely randomly.
Pair Corralation between Thai Beverage and ReAlpha Tech
Assuming the 90 days horizon Thai Beverage PCL is expected to under-perform the ReAlpha Tech. But the pink sheet apears to be less risky and, when comparing its historical volatility, Thai Beverage PCL is 9.79 times less risky than ReAlpha Tech. The pink sheet trades about -0.02 of its potential returns per unit of risk. The reAlpha Tech Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 179.00 in reAlpha Tech Corp on December 4, 2024 and sell it today you would lose (39.00) from holding reAlpha Tech Corp or give up 21.79% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 74.29% |
Values | Daily Returns |
Thai Beverage PCL vs. reAlpha Tech Corp
Performance |
Timeline |
Thai Beverage PCL |
reAlpha Tech Corp |
Thai Beverage and ReAlpha Tech Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Thai Beverage and ReAlpha Tech
The main advantage of trading using opposite Thai Beverage and ReAlpha Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai Beverage position performs unexpectedly, ReAlpha Tech 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 ReAlpha Tech will offset losses from the drop in ReAlpha Tech's long position.Thai Beverage vs. Andrew Peller Limited | Thai Beverage vs. Aristocrat Group Corp | Thai Beverage vs. Iconic Brands | Thai Beverage vs. Naked Wines plc |
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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