Correlation Between Siam Cement and Niagara Mohawk
Can any of the company-specific risk be diversified away by investing in both Siam Cement and Niagara Mohawk 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 Niagara Mohawk 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 Niagara Mohawk Power, you can compare the effects of market volatilities on Siam Cement and Niagara Mohawk 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 Niagara Mohawk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siam Cement and Niagara Mohawk.
Diversification Opportunities for Siam Cement and Niagara Mohawk
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Siam and Niagara is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding The Siam Cement and Niagara Mohawk Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Niagara Mohawk Power 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 Niagara Mohawk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Niagara Mohawk Power has no effect on the direction of Siam Cement i.e., Siam Cement and Niagara Mohawk go up and down completely randomly.
Pair Corralation between Siam Cement and Niagara Mohawk
Assuming the 90 days horizon Siam Cement is expected to generate 4.49 times less return on investment than Niagara Mohawk. In addition to that, Siam Cement is 2.23 times more volatile than Niagara Mohawk Power. It trades about 0.01 of its total potential returns per unit of risk. Niagara Mohawk Power is currently generating about 0.08 per unit of volatility. If you would invest 5,542 in Niagara Mohawk Power on September 1, 2024 and sell it today you would earn a total of 658.00 from holding Niagara Mohawk Power or generate 11.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.39% |
| Values | Daily Returns |
The Siam Cement vs. Niagara Mohawk Power
Performance |
| Timeline |
| Siam Cement |
| Niagara Mohawk Power |
Siam Cement and Niagara Mohawk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siam Cement and Niagara Mohawk
The main advantage of trading using opposite Siam Cement and Niagara Mohawk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siam Cement position performs unexpectedly, Niagara Mohawk 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 Niagara Mohawk will offset losses from the drop in Niagara Mohawk's long position.| Siam Cement vs. FTAI Infrastructure | Siam Cement vs. RCM Technologies | Siam Cement vs. NN Inc | Siam Cement vs. Tejon Ranch Co |
| Niagara Mohawk vs. Legacy Education | Niagara Mohawk vs. Apple Inc | Niagara Mohawk vs. NVIDIA | Niagara Mohawk vs. Microsoft |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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