Correlation Between Siamgas and DevEx Resources
Can any of the company-specific risk be diversified away by investing in both Siamgas and DevEx Resources 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 Siamgas and DevEx Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siamgas And Petrochemicals and DevEx Resources Limited, you can compare the effects of market volatilities on Siamgas and DevEx Resources 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 Siamgas with a short position of DevEx Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siamgas and DevEx Resources.
Diversification Opportunities for Siamgas and DevEx Resources
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Siamgas and DevEx is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Siamgas And Petrochemicals and DevEx Resources Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DevEx Resources and Siamgas 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 Siamgas And Petrochemicals are associated (or correlated) with DevEx Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DevEx Resources has no effect on the direction of Siamgas i.e., Siamgas and DevEx Resources go up and down completely randomly.
Pair Corralation between Siamgas and DevEx Resources
Assuming the 90 days trading horizon Siamgas is expected to generate 4.88 times less return on investment than DevEx Resources. But when comparing it to its historical volatility, Siamgas And Petrochemicals is 10.0 times less risky than DevEx Resources. It trades about 0.22 of its potential returns per unit of risk. DevEx Resources Limited is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 4.35 in DevEx Resources Limited on November 4, 2024 and sell it today you would earn a total of 0.65 from holding DevEx Resources Limited or generate 14.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Siamgas And Petrochemicals vs. DevEx Resources Limited
Performance |
| Timeline |
| Siamgas And Petroche |
| DevEx Resources |
Siamgas and DevEx Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siamgas and DevEx Resources
The main advantage of trading using opposite Siamgas and DevEx Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siamgas position performs unexpectedly, DevEx Resources 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 DevEx Resources will offset losses from the drop in DevEx Resources' long position.| Siamgas vs. VIRGIN WINES UK | Siamgas vs. Grand Canyon Education | Siamgas vs. CHINA TONTINE WINES | Siamgas vs. betterU Education Corp |
| DevEx Resources vs. Fukuyama Transporting Co | DevEx Resources vs. AOI Electronics Co | DevEx Resources vs. SOEDER SPORTFISKE AB | DevEx Resources vs. Meiko Electronics Co |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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