Correlation Between Thai President and Bioscience Animal
Can any of the company-specific risk be diversified away by investing in both Thai President and Bioscience Animal 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 President and Bioscience Animal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thai President Foods and Bioscience Animal Health, you can compare the effects of market volatilities on Thai President and Bioscience Animal 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 President with a short position of Bioscience Animal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai President and Bioscience Animal.
Diversification Opportunities for Thai President and Bioscience Animal
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Thai and Bioscience is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Thai President Foods and Bioscience Animal Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bioscience Animal Health and Thai President 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 President Foods are associated (or correlated) with Bioscience Animal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bioscience Animal Health has no effect on the direction of Thai President i.e., Thai President and Bioscience Animal go up and down completely randomly.
Pair Corralation between Thai President and Bioscience Animal
Assuming the 90 days trading horizon Thai President Foods is expected to generate 0.28 times more return on investment than Bioscience Animal. However, Thai President Foods is 3.55 times less risky than Bioscience Animal. It trades about 0.07 of its potential returns per unit of risk. Bioscience Animal Health is currently generating about -0.05 per unit of risk. If you would invest 19,457 in Thai President Foods on September 12, 2024 and sell it today you would earn a total of 493.00 from holding Thai President Foods or generate 2.53% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Thai President Foods vs. Bioscience Animal Health
Performance |
Timeline |
Thai President Foods |
Bioscience Animal Health |
Thai President and Bioscience Animal Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Thai President and Bioscience Animal
The main advantage of trading using opposite Thai President and Bioscience Animal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thai President position performs unexpectedly, Bioscience Animal 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 Bioscience Animal will offset losses from the drop in Bioscience Animal's long position.Thai President vs. GFPT Public | Thai President vs. Dynasty Ceramic Public | Thai President vs. Haad Thip Public | Thai President vs. The Erawan Group |
Bioscience Animal vs. Thai Union Group | Bioscience Animal vs. Thai Union Group | Bioscience Animal vs. Thai President Foods | Bioscience Animal vs. Thai Vegetable Oil |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
Stocks Directory Find actively traded stocks across global markets | |
Equity Valuation Check real value of public entities based on technical and fundamental data | |
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |