Correlation Between Siamgas and DATATEC

Can any of the company-specific risk be diversified away by investing in both Siamgas and DATATEC 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 DATATEC 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 DATATEC LTD 2, you can compare the effects of market volatilities on Siamgas and DATATEC 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 DATATEC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siamgas and DATATEC.

Diversification Opportunities for Siamgas and DATATEC

0.13

Correlation Coefficient

Siamgas  DATATEC

Average diversification

The 3 months correlation between Siamgas and DATATEC is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Siamgas And Petrochemicals and DATATEC LTD 2 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DATATEC LTD 2 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 DATATEC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DATATEC LTD 2 has no effect on the direction of Siamgas i.e., Siamgas and DATATEC go up and down completely randomly.

Pair Corralation between Siamgas and DATATEC

Assuming the 90 days trading horizon Siamgas is expected to generate 16.62 times less return on investment than DATATEC. In addition to that, Siamgas is 1.05 times more volatile than DATATEC LTD 2. It trades about 0.01 of its total potential returns per unit of risk. DATATEC LTD 2 is currently generating about 0.22 per unit of volatility. If you would invest  359.00  in DATATEC LTD 2 on October 24, 2024 and sell it today you would earn a total of  129.00  from holding DATATEC LTD 2 or generate 35.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Siamgas And Petrochemicals  vs.  DATATEC LTD 2

Siamgas And Petroche

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Siamgas And Petrochemicals are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Siamgas is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

DATATEC LTD 2

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in DATATEC LTD 2 are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, DATATEC reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Siamgas and DATATEC

The main advantage of trading using opposite Siamgas and DATATEC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siamgas position performs unexpectedly, DATATEC 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 DATATEC will offset losses from the drop in DATATEC's long position.

The idea behind Siamgas And Petrochemicals and DATATEC LTD 2 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.