Correlation Between Thanachart Capital and Siam Commercial
Can any of the company-specific risk be diversified away by investing in both Thanachart Capital and Siam Commercial 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 Thanachart Capital and Siam Commercial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thanachart Capital Public and The Siam Commercial, you can compare the effects of market volatilities on Thanachart Capital and Siam Commercial 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 Thanachart Capital with a short position of Siam Commercial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thanachart Capital and Siam Commercial.
Diversification Opportunities for Thanachart Capital and Siam Commercial
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Thanachart and Siam is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Thanachart Capital Public and The Siam Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siam Commercial and Thanachart Capital 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 Thanachart Capital Public are associated (or correlated) with Siam Commercial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siam Commercial has no effect on the direction of Thanachart Capital i.e., Thanachart Capital and Siam Commercial go up and down completely randomly.
Pair Corralation between Thanachart Capital and Siam Commercial
Assuming the 90 days trading horizon Thanachart Capital is expected to generate 50.49 times less return on investment than Siam Commercial. But when comparing it to its historical volatility, Thanachart Capital Public is 1.66 times less risky than Siam Commercial. It trades about 0.01 of its potential returns per unit of risk. The Siam Commercial is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 10,945 in The Siam Commercial on September 13, 2024 and sell it today you would earn a total of 855.00 from holding The Siam Commercial or generate 7.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thanachart Capital Public vs. The Siam Commercial
Performance |
| Timeline |
| Thanachart Capital Public |
| Siam Commercial |
Thanachart Capital and Siam Commercial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thanachart Capital and Siam Commercial
The main advantage of trading using opposite Thanachart Capital and Siam Commercial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thanachart Capital position performs unexpectedly, Siam Commercial 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 Commercial will offset losses from the drop in Siam Commercial's long position.| Thanachart Capital vs. The Siam Commercial | Thanachart Capital vs. Thai Oil Public | Thanachart Capital vs. Thai Union Group | Thanachart Capital vs. Kasikornbank Public |
| Siam Commercial vs. The Siam Cement | Siam Commercial vs. Krung Thai Bank | Siam Commercial vs. Airports of Thailand | Siam Commercial vs. Kasikornbank 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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