Correlation Between Erawan and Siri Prime
Can any of the company-specific risk be diversified away by investing in both Erawan and Siri Prime 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 Erawan and Siri Prime into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Erawan Group and Siri Prime Office, you can compare the effects of market volatilities on Erawan and Siri Prime 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 Erawan with a short position of Siri Prime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Erawan and Siri Prime.
Diversification Opportunities for Erawan and Siri Prime
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Erawan and Siri is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding The Erawan Group and Siri Prime Office in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siri Prime Office and Erawan 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 The Erawan Group are associated (or correlated) with Siri Prime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siri Prime Office has no effect on the direction of Erawan i.e., Erawan and Siri Prime go up and down completely randomly.
Pair Corralation between Erawan and Siri Prime
Assuming the 90 days trading horizon Erawan is expected to generate 38.94 times less return on investment than Siri Prime. But when comparing it to its historical volatility, The Erawan Group is 6.06 times less risky than Siri Prime. It trades about 0.04 of its potential returns per unit of risk. Siri Prime Office is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 730.00 in Siri Prime Office on September 12, 2024 and sell it today you would lose (730.00) from holding Siri Prime Office or give up 100.0% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 71.31% |
Values | Daily Returns |
The Erawan Group vs. Siri Prime Office
Performance |
Timeline |
Erawan Group |
Siri Prime Office |
Erawan and Siri Prime Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Erawan and Siri Prime
The main advantage of trading using opposite Erawan and Siri Prime positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Erawan position performs unexpectedly, Siri Prime 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 Siri Prime will offset losses from the drop in Siri Prime's long position.Erawan vs. Central Plaza Hotel | Erawan vs. Minor International Public | Erawan vs. Central Pattana Public | Erawan vs. CP ALL Public |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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