Correlation Between Siam Cement and Polyplex Public
Can any of the company-specific risk be diversified away by investing in both Siam Cement and Polyplex Public 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 Polyplex Public 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 Polyplex Public, you can compare the effects of market volatilities on Siam Cement and Polyplex Public 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 Polyplex Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siam Cement and Polyplex Public.
Diversification Opportunities for Siam Cement and Polyplex Public
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Siam and Polyplex is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding The Siam Cement and Polyplex Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polyplex Public 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 Polyplex Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polyplex Public has no effect on the direction of Siam Cement i.e., Siam Cement and Polyplex Public go up and down completely randomly.
Pair Corralation between Siam Cement and Polyplex Public
Assuming the 90 days trading horizon The Siam Cement is expected to under-perform the Polyplex Public. But the stock apears to be less risky and, when comparing its historical volatility, The Siam Cement is 1.19 times less risky than Polyplex Public. The stock trades about -0.39 of its potential returns per unit of risk. The Polyplex Public is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 1,299 in Polyplex Public on September 4, 2024 and sell it today you would lose (29.00) from holding Polyplex Public or give up 2.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
The Siam Cement vs. Polyplex Public
Performance |
| Timeline |
| Siam Cement |
| Polyplex Public |
Siam Cement and Polyplex Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siam Cement and Polyplex Public
The main advantage of trading using opposite Siam Cement and Polyplex Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siam Cement position performs unexpectedly, Polyplex Public 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 Polyplex Public will offset losses from the drop in Polyplex Public's long position.| Siam Cement vs. Eastern Technical Engineering | Siam Cement vs. General Environmental Conservation | Siam Cement vs. Silicon Craft Technology | Siam Cement vs. NAT ABSOLUTE TECHNOLOGIES |
| Polyplex Public vs. Precious Shipping Public | Polyplex Public vs. PTT Global Chemical | Polyplex Public vs. Indorama Ventures PCL | Polyplex Public vs. Somboon Advance Technology |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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