Correlation Between Thai Beverage and SAG Holdings

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

Diversification Opportunities for Thai Beverage and SAG Holdings

0.0

Correlation Coefficient

Thai Beverage  SAG Holdings

Pay attention - limited upside

The 3 months correlation between Thai and SAG is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Thai Beverage PCL and SAG Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAG Holdings Limited 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 SAG Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAG Holdings Limited has no effect on the direction of Thai Beverage i.e., Thai Beverage and SAG Holdings go up and down completely randomly.

Pair Corralation between Thai Beverage and SAG Holdings

If you would invest  3,367  in Thai Beverage PCL on October 8, 2024 and sell it today you would earn a total of  0.00  from holding Thai Beverage PCL or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	79.69%
Values	Daily Returns

Thai Beverage PCL  vs.  SAG Holdings Limited

Thai Beverage PCL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thai Beverage PCL has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Thai Beverage is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

SAG Holdings Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SAG Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Thai Beverage and SAG Holdings

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

The idea behind Thai Beverage PCL and SAG Holdings Limited 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.