Correlation Between Siam Global and Krung Thai
Can any of the company-specific risk be diversified away by investing in both Siam Global and Krung Thai 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 Siam Global and Krung Thai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siam Global House and Krung Thai Bank, you can compare the effects of market volatilities on Siam Global and Krung Thai 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 Siam Global with a short position of Krung Thai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siam Global and Krung Thai.
Diversification Opportunities for Siam Global and Krung Thai
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Siam and Krung is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Siam Global House and Krung Thai Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Krung Thai Bank and Siam Global 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 Siam Global House are associated (or correlated) with Krung Thai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Krung Thai Bank has no effect on the direction of Siam Global i.e., Siam Global and Krung Thai go up and down completely randomly.
Pair Corralation between Siam Global and Krung Thai
Assuming the 90 days trading horizon Siam Global is expected to generate 1.9 times less return on investment than Krung Thai. In addition to that, Siam Global is 1.45 times more volatile than Krung Thai Bank. It trades about 0.05 of its total potential returns per unit of risk. Krung Thai Bank is currently generating about 0.14 per unit of volatility. If you would invest 1,860 in Krung Thai Bank on August 28, 2024 and sell it today you would earn a total of 190.00 from holding Krung Thai Bank or generate 10.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.41% |
| Values | Daily Returns |
Siam Global House vs. Krung Thai Bank
Performance |
| Timeline |
| Siam Global House |
| Krung Thai Bank |
Siam Global and Krung Thai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siam Global and Krung Thai
The main advantage of trading using opposite Siam Global and Krung Thai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siam Global position performs unexpectedly, Krung Thai 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 Krung Thai will offset losses from the drop in Krung Thai's long position.| Siam Global vs. SCB X Public | Siam Global vs. Kasikornbank Public | Siam Global vs. PTT Public | Siam Global vs. Kasikornbank Public |
| Krung Thai vs. Supalai Public | Krung Thai vs. Thai Oil Public | Krung Thai vs. The Erawan Group | Krung Thai vs. Ditto Public |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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