Correlation Between JD Food and Siam Wellness
Can any of the company-specific risk be diversified away by investing in both JD Food and Siam Wellness 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 JD Food and Siam Wellness into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JD Food PCL and Siam Wellness Group, you can compare the effects of market volatilities on JD Food and Siam Wellness 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 JD Food with a short position of Siam Wellness. Check out your portfolio center. Please also check ongoing floating volatility patterns of JD Food and Siam Wellness.
Diversification Opportunities for JD Food and Siam Wellness
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between JDF and Siam is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding JD Food PCL and Siam Wellness Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siam Wellness Group and JD Food 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 JD Food PCL are associated (or correlated) with Siam Wellness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siam Wellness Group has no effect on the direction of JD Food i.e., JD Food and Siam Wellness go up and down completely randomly.
Pair Corralation between JD Food and Siam Wellness
Assuming the 90 days trading horizon JD Food PCL is expected to generate 0.39 times more return on investment than Siam Wellness. However, JD Food PCL is 2.59 times less risky than Siam Wellness. It trades about -0.03 of its potential returns per unit of risk. Siam Wellness Group is currently generating about -0.18 per unit of risk. If you would invest 204.00 in JD Food PCL on November 30, 2024 and sell it today you would lose (4.00) from holding JD Food PCL or give up 1.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JD Food PCL vs. Siam Wellness Group
Performance |
| Timeline |
| JD Food PCL |
| Siam Wellness Group |
JD Food and Siam Wellness Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JD Food and Siam Wellness
The main advantage of trading using opposite JD Food and Siam Wellness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JD Food position performs unexpectedly, Siam Wellness 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 Siam Wellness will offset losses from the drop in Siam Wellness' long position.| JD Food vs. NSL Foods Public | JD Food vs. Chiangmai Frozen Foods | JD Food vs. Communication System Solution | JD Food vs. Tipco Foods Public |
| Siam Wellness vs. Minor International Public | Siam Wellness vs. Central Plaza Hotel | Siam Wellness vs. The Erawan Group | Siam Wellness vs. After You 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 Stocks Directory module to find actively traded stocks across global markets.
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