Correlation Between Siamgas and Ekarat Engineering
Can any of the company-specific risk be diversified away by investing in both Siamgas and Ekarat Engineering 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 Siamgas and Ekarat Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siamgas and Petrochemicals and Ekarat Engineering Public, you can compare the effects of market volatilities on Siamgas and Ekarat Engineering 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 Siamgas with a short position of Ekarat Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siamgas and Ekarat Engineering.
Diversification Opportunities for Siamgas and Ekarat Engineering
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Siamgas and Ekarat is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Siamgas and Petrochemicals and Ekarat Engineering Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ekarat Engineering Public and Siamgas 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 Siamgas and Petrochemicals are associated (or correlated) with Ekarat Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ekarat Engineering Public has no effect on the direction of Siamgas i.e., Siamgas and Ekarat Engineering go up and down completely randomly.
Pair Corralation between Siamgas and Ekarat Engineering
Assuming the 90 days trading horizon Siamgas is expected to generate 1.03 times less return on investment than Ekarat Engineering. But when comparing it to its historical volatility, Siamgas and Petrochemicals is 1.0 times less risky than Ekarat Engineering. It trades about 0.05 of its potential returns per unit of risk. Ekarat Engineering Public is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 82.00 in Ekarat Engineering Public on September 12, 2024 and sell it today you would earn a total of 13.00 from holding Ekarat Engineering Public or generate 15.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siamgas and Petrochemicals vs. Ekarat Engineering Public
Performance |
| Timeline |
| Siamgas and Petroche |
| Ekarat Engineering Public |
Siamgas and Ekarat Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siamgas and Ekarat Engineering
The main advantage of trading using opposite Siamgas and Ekarat Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siamgas position performs unexpectedly, Ekarat Engineering 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 Ekarat Engineering will offset losses from the drop in Ekarat Engineering's long position.| Siamgas vs. Bangchak Public | Siamgas vs. IRPC Public | Siamgas vs. PTT Exploration and | Siamgas vs. Star Petroleum Refining |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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