Correlation Between Thai Capital and RPCG Public

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

By analyzing existing cross correlation between Thai Capital and RPCG Public, you can compare the effects of market volatilities on Thai Capital and RPCG Public 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 RPCG Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thai Capital and RPCG Public.

Diversification Opportunities for Thai Capital and RPCG Public

0.01

Correlation Coefficient

Thai Capital  RPCG Public

Significant diversification

The 3 months correlation between Thai and RPCG is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Thai Capital and RPCG Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RPCG Public 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 RPCG Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RPCG Public has no effect on the direction of Thai Capital i.e., Thai Capital and RPCG Public go up and down completely randomly.

Pair Corralation between Thai Capital and RPCG Public

Assuming the 90 days trading horizon Thai Capital is expected to generate 1.19 times more return on investment than RPCG Public. However, Thai Capital is 1.19 times more volatile than RPCG Public. It trades about 0.13 of its potential returns per unit of risk. RPCG Public is currently generating about 0.07 per unit of risk. If you would invest  23.00  in Thai Capital on April 24, 2025 and sell it today you would earn a total of  7.00  from holding Thai Capital or generate 30.43% return on investment over 90 days.

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

Thai Capital  vs.  RPCG Public

Thai Capital

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Thai Capital are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting fundamental indicators, Thai Capital disclosed solid returns over the last few months and may actually be approaching a breakup point.

RPCG Public

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in RPCG Public are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting fundamental indicators, RPCG Public disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Thai Capital and RPCG Public

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

The idea behind Thai Capital and RPCG Public 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.