Correlation Between Siamgas and Laureate Education
Can any of the company-specific risk be diversified away by investing in both Siamgas and Laureate Education 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 Laureate Education 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 Laureate Education, you can compare the effects of market volatilities on Siamgas and Laureate Education 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 Laureate Education. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siamgas and Laureate Education.
Diversification Opportunities for Siamgas and Laureate Education
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Siamgas and Laureate is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Siamgas And Petrochemicals and Laureate Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Laureate 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 Laureate Education. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Laureate Education has no effect on the direction of Siamgas i.e., Siamgas and Laureate Education go up and down completely randomly.
Pair Corralation between Siamgas and Laureate Education
Assuming the 90 days trading horizon Siamgas And Petrochemicals is expected to generate 3.41 times more return on investment than Laureate Education. However, Siamgas is 3.41 times more volatile than Laureate Education. It trades about 0.04 of its potential returns per unit of risk. Laureate Education is currently generating about 0.07 per unit of risk. If you would invest 11.00 in Siamgas And Petrochemicals on October 11, 2024 and sell it today you would earn a total of 7.00 from holding Siamgas And Petrochemicals or generate 63.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 99.8% |
Values | Daily Returns |
Siamgas And Petrochemicals vs. Laureate Education
Performance |
Timeline |
Siamgas And Petroche |
Laureate Education |
Siamgas and Laureate Education Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Siamgas and Laureate Education
The main advantage of trading using opposite Siamgas and Laureate Education positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siamgas position performs unexpectedly, Laureate Education 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 Laureate Education will offset losses from the drop in Laureate Education's long position.Siamgas vs. DIVERSIFIED ROYALTY | Siamgas vs. Guangdong Investment Limited | Siamgas vs. Eidesvik Offshore ASA | Siamgas vs. Information Services International Dentsu |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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