Correlation Between Siri Prime and Siam Steel
Can any of the company-specific risk be diversified away by investing in both Siri Prime and Siam Steel 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 Siri Prime and Siam Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siri Prime Office and Siam Steel International, you can compare the effects of market volatilities on Siri Prime and Siam Steel 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 Siri Prime with a short position of Siam Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siri Prime and Siam Steel.
Diversification Opportunities for Siri Prime and Siam Steel
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Siri and Siam is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Siri Prime Office and Siam Steel International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siam Steel International and Siri Prime 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 Siri Prime Office are associated (or correlated) with Siam Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siam Steel International has no effect on the direction of Siri Prime i.e., Siri Prime and Siam Steel go up and down completely randomly.
Pair Corralation between Siri Prime and Siam Steel
Assuming the 90 days trading horizon Siri Prime is expected to generate 30.82 times less return on investment than Siam Steel. But when comparing it to its historical volatility, Siri Prime Office is 24.4 times less risky than Siam Steel. It trades about 0.03 of its potential returns per unit of risk. Siam Steel International is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 141.00 in Siam Steel International on September 3, 2024 and sell it today you would lose (33.00) from holding Siam Steel International or give up 23.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siri Prime Office vs. Siam Steel International
Performance |
| Timeline |
| Siri Prime Office |
| Siam Steel International |
Siri Prime and Siam Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siri Prime and Siam Steel
The main advantage of trading using opposite Siri Prime and Siam Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siri Prime position performs unexpectedly, Siam Steel 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 Siam Steel will offset losses from the drop in Siam Steel's long position.| Siri Prime vs. Land and Houses | Siri Prime vs. Quality Houses Public | Siri Prime vs. AP Public | Siri Prime vs. SCB X Public |
| Siam Steel vs. Siam Steel Service | Siam Steel vs. Siri Prime Office | Siam Steel vs. Ocean Glass Public | Siam Steel vs. Rockworth 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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