Correlation Between Siam Cement and NCL International
Can any of the company-specific risk be diversified away by investing in both Siam Cement and NCL International 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 Cement and NCL International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Siam Cement and NCL International Logistics, you can compare the effects of market volatilities on Siam Cement and NCL International 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 Cement with a short position of NCL International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siam Cement and NCL International.
Diversification Opportunities for Siam Cement and NCL International
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Siam and NCL is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding The Siam Cement and NCL International Logistics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NCL International and Siam Cement 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 Cement are associated (or correlated) with NCL International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NCL International has no effect on the direction of Siam Cement i.e., Siam Cement and NCL International go up and down completely randomly.
Pair Corralation between Siam Cement and NCL International
Assuming the 90 days trading horizon The Siam Cement is expected to under-perform the NCL International. But the stock apears to be less risky and, when comparing its historical volatility, The Siam Cement is 24.92 times less risky than NCL International. The stock trades about -0.07 of its potential returns per unit of risk. The NCL International Logistics is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 91.00 in NCL International Logistics on August 28, 2024 and sell it today you would lose (49.00) from holding NCL International Logistics or give up 53.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.5% |
| Values | Daily Returns |
The Siam Cement vs. NCL International Logistics
Performance |
| Timeline |
| Siam Cement |
| NCL International |
Siam Cement and NCL International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siam Cement and NCL International
The main advantage of trading using opposite Siam Cement and NCL International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siam Cement position performs unexpectedly, NCL International 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 NCL International will offset losses from the drop in NCL International's long position.| Siam Cement vs. PTT Public | Siam Cement vs. The Siam Commercial | Siam Cement vs. Airports of Thailand | Siam Cement vs. CP ALL Public |
| NCL International vs. Kingsmen CMTI Public | NCL International vs. Masterkool International Public | NCL International vs. News Network | NCL International vs. Internet Thailand 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |