Correlation Between Tong Hua and Ngern Tid

Can any of the company-specific risk be diversified away by investing in both Tong Hua and Ngern Tid 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 Tong Hua and Ngern Tid into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Tong Hua Holding and Ngern Tid Lor, you can compare the effects of market volatilities on Tong Hua and Ngern Tid 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 Tong Hua with a short position of Ngern Tid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tong Hua and Ngern Tid.

Diversification Opportunities for Tong Hua and Ngern Tid

0.0

Correlation Coefficient

Tong Hua  Ngern Tid

Pay attention - limited upside

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

Pair Corralation between Tong Hua and Ngern Tid

If you would invest  2,030  in Ngern Tid Lor on April 20, 2025 and sell it today you would lose (290.00) from holding Ngern Tid Lor or give up 14.29% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.21%
Values	Daily Returns

Tong Hua Holding  vs.  Ngern Tid Lor

Tong Hua Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tong Hua Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent fundamental drivers, Tong Hua is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Ngern Tid Lor

Risk-Adjusted Performance

Modest

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

Pair Trading with Tong Hua and Ngern Tid

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

The idea behind Tong Hua Holding and Ngern Tid Lor 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.

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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.