Correlation Between Thai Capital and Unique Mining

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

By analyzing existing cross correlation between Thai Capital and Unique Mining Services, you can compare the effects of market volatilities on Thai Capital and Unique Mining 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 Capital with a short position of Unique Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Capital and Unique Mining.

Diversification Opportunities for Thai Capital and Unique Mining

0.65

Correlation Coefficient

Thai Capital  Unique Mining

Poor diversification

The 3 months correlation between Thai and Unique is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Thai Capital and Unique Mining Services in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unique Mining Services and Thai Capital 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 Capital are associated (or correlated) with Unique Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unique Mining Services has no effect on the direction of Thai Capital i.e., Thai Capital and Unique Mining go up and down completely randomly.

Pair Corralation between Thai Capital and Unique Mining

Assuming the 90 days trading horizon Thai Capital is expected to generate 1.0 times more return on investment than Unique Mining. However, Thai Capital is 1.0 times less risky than Unique Mining. It trades about 0.04 of its potential returns per unit of risk. Unique Mining Services is currently generating about 0.04 per unit of risk. If you would invest  82.00  in Thai Capital on September 27, 2024 and sell it today you would lose (42.00) from holding Thai Capital or give up 51.22% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.78%
Values	Daily Returns

Thai Capital  vs.  Unique Mining Services

Thai Capital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Thai Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's fundamental indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Unique Mining Services

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Unique Mining Services has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Thai Capital and Unique Mining

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

The idea behind Thai Capital and Unique Mining Services 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.