Correlation Between Peak Resources and Siamgas
Can any of the company-specific risk be diversified away by investing in both Peak Resources and Siamgas 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 Peak Resources and Siamgas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Peak Resources Limited and Siamgas And Petrochemicals, you can compare the effects of market volatilities on Peak Resources and Siamgas 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 Peak Resources with a short position of Siamgas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peak Resources and Siamgas.
Diversification Opportunities for Peak Resources and Siamgas
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Peak and Siamgas is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Peak Resources Limited and Siamgas And Petrochemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siamgas And Petroche and Peak Resources 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 Peak Resources Limited are associated (or correlated) with Siamgas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siamgas And Petroche has no effect on the direction of Peak Resources i.e., Peak Resources and Siamgas go up and down completely randomly.
Pair Corralation between Peak Resources and Siamgas
Assuming the 90 days horizon Peak Resources Limited is expected to generate 4.5 times more return on investment than Siamgas. However, Peak Resources is 4.5 times more volatile than Siamgas And Petrochemicals. It trades about 0.04 of its potential returns per unit of risk. Siamgas And Petrochemicals is currently generating about 0.01 per unit of risk. If you would invest 5.75 in Peak Resources Limited on September 15, 2024 and sell it today you would lose (0.15) from holding Peak Resources Limited or give up 2.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peak Resources Limited vs. Siamgas And Petrochemicals
Performance |
| Timeline |
| Peak Resources |
| Siamgas And Petroche |
Peak Resources and Siamgas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peak Resources and Siamgas
The main advantage of trading using opposite Peak Resources and Siamgas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peak Resources position performs unexpectedly, Siamgas 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 Siamgas will offset losses from the drop in Siamgas' long position.| Peak Resources vs. SINGAPORE AIRLINES | Peak Resources vs. National Beverage Corp | Peak Resources vs. BOSTON BEER A | Peak Resources vs. Ramsay Health Care |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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