Correlation Between Siamgas and Grand Canyon
Can any of the company-specific risk be diversified away by investing in both Siamgas and Grand Canyon 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 Grand Canyon 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 Grand Canyon Education, you can compare the effects of market volatilities on Siamgas and Grand Canyon 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 Grand Canyon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siamgas and Grand Canyon.
Diversification Opportunities for Siamgas and Grand Canyon
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Siamgas and Grand is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Siamgas And Petrochemicals and Grand Canyon Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Canyon Education 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 Grand Canyon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Canyon Education has no effect on the direction of Siamgas i.e., Siamgas and Grand Canyon go up and down completely randomly.
Pair Corralation between Siamgas and Grand Canyon
Assuming the 90 days trading horizon Siamgas is expected to generate 23.38 times less return on investment than Grand Canyon. But when comparing it to its historical volatility, Siamgas And Petrochemicals is 1.12 times less risky than Grand Canyon. It trades about 0.01 of its potential returns per unit of risk. Grand Canyon Education is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 12,400 in Grand Canyon Education on September 2, 2024 and sell it today you would earn a total of 3,000 from holding Grand Canyon Education or generate 24.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siamgas And Petrochemicals vs. Grand Canyon Education
Performance |
| Timeline |
| Siamgas And Petroche |
| Grand Canyon Education |
Siamgas and Grand Canyon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siamgas and Grand Canyon
The main advantage of trading using opposite Siamgas and Grand Canyon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siamgas position performs unexpectedly, Grand Canyon 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 Grand Canyon will offset losses from the drop in Grand Canyon's long position.The idea behind Siamgas And Petrochemicals and Grand Canyon Education 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.| Grand Canyon vs. Monster Beverage Corp | Grand Canyon vs. Siamgas And Petrochemicals | Grand Canyon vs. SHIN ETSU CHEMICAL | Grand Canyon vs. Sanyo Chemical Industries |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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