Correlation Between Siam Commercial and Thaifoods Group
Can any of the company-specific risk be diversified away by investing in both Siam Commercial and Thaifoods Group 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 Commercial and Thaifoods Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Siam Commercial and Thaifoods Group Public, you can compare the effects of market volatilities on Siam Commercial and Thaifoods Group 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 Commercial with a short position of Thaifoods Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siam Commercial and Thaifoods Group.
Diversification Opportunities for Siam Commercial and Thaifoods Group
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Siam and Thaifoods is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding The Siam Commercial and Thaifoods Group Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thaifoods Group Public and Siam Commercial 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 Siam Commercial are associated (or correlated) with Thaifoods Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thaifoods Group Public has no effect on the direction of Siam Commercial i.e., Siam Commercial and Thaifoods Group go up and down completely randomly.
Pair Corralation between Siam Commercial and Thaifoods Group
Assuming the 90 days trading horizon The Siam Commercial is expected to generate 0.4 times more return on investment than Thaifoods Group. However, The Siam Commercial is 2.53 times less risky than Thaifoods Group. It trades about 0.3 of its potential returns per unit of risk. Thaifoods Group Public is currently generating about -0.22 per unit of risk. If you would invest 10,945 in The Siam Commercial on September 14, 2024 and sell it today you would earn a total of 805.00 from holding The Siam Commercial or generate 7.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Siam Commercial vs. Thaifoods Group Public
Performance |
| Timeline |
| Siam Commercial |
| Thaifoods Group Public |
Siam Commercial and Thaifoods Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siam Commercial and Thaifoods Group
The main advantage of trading using opposite Siam Commercial and Thaifoods Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siam Commercial position performs unexpectedly, Thaifoods Group 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 Thaifoods Group will offset losses from the drop in Thaifoods Group's long position.| Siam Commercial vs. The Siam Cement | Siam Commercial vs. Krung Thai Bank | Siam Commercial vs. Airports of Thailand | Siam Commercial vs. Kasikornbank Public |
| Thaifoods Group vs. Thaifoods Group Public | Thaifoods Group vs. Thai President Foods | Thaifoods Group vs. Thai Capital | Thaifoods Group vs. Thaicom 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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