Correlation Between Siamgas and Lanna Resources
Can any of the company-specific risk be diversified away by investing in both Siamgas and Lanna Resources 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 Lanna Resources 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 Lanna Resources Public, you can compare the effects of market volatilities on Siamgas and Lanna Resources 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 Lanna Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siamgas and Lanna Resources.
Diversification Opportunities for Siamgas and Lanna Resources
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Siamgas and Lanna is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Siamgas and Petrochemicals and Lanna Resources Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lanna Resources 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 Lanna Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lanna Resources Public has no effect on the direction of Siamgas i.e., Siamgas and Lanna Resources go up and down completely randomly.
Pair Corralation between Siamgas and Lanna Resources
Assuming the 90 days trading horizon Siamgas and Petrochemicals is expected to generate 1.44 times more return on investment than Lanna Resources. However, Siamgas is 1.44 times more volatile than Lanna Resources Public. It trades about -0.03 of its potential returns per unit of risk. Lanna Resources Public is currently generating about -0.14 per unit of risk. If you would invest 720.00 in Siamgas and Petrochemicals on September 4, 2024 and sell it today you would lose (5.00) from holding Siamgas and Petrochemicals or give up 0.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siamgas and Petrochemicals vs. Lanna Resources Public
Performance |
| Timeline |
| Siamgas and Petroche |
| Lanna Resources Public |
Siamgas and Lanna Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siamgas and Lanna Resources
The main advantage of trading using opposite Siamgas and Lanna Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siamgas position performs unexpectedly, Lanna Resources 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 Lanna Resources will offset losses from the drop in Lanna Resources' long position.| Siamgas vs. PTT Public | Siamgas vs. SCB X Public | Siamgas vs. The Siam Commercial | Siamgas vs. The Siam Cement |
| Lanna Resources vs. PTT Public | Lanna Resources vs. SCB X Public | Lanna Resources vs. The Siam Commercial | Lanna Resources vs. The Siam Cement |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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