Correlation Between Siamgas and CSSC Offshore

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

Diversification Opportunities for Siamgas and CSSC Offshore

0.42

Correlation Coefficient

Siamgas  CSSC Offshore

Very weak diversification

The 3 months correlation between Siamgas and CSSC is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Siamgas And Petrochemicals and CSSC Offshore Marine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSSC Offshore Marine 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 CSSC Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSSC Offshore Marine has no effect on the direction of Siamgas i.e., Siamgas and CSSC Offshore go up and down completely randomly.

Pair Corralation between Siamgas and CSSC Offshore

Assuming the 90 days trading horizon Siamgas And Petrochemicals is expected to generate 2.47 times more return on investment than CSSC Offshore. However, Siamgas is 2.47 times more volatile than CSSC Offshore Marine. It trades about 0.06 of its potential returns per unit of risk. CSSC Offshore Marine is currently generating about -0.08 per unit of risk. If you would invest  14.00  in Siamgas And Petrochemicals on September 29, 2024 and sell it today you would earn a total of  4.00  from holding Siamgas And Petrochemicals or generate 28.57% return on investment over 90 days.

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

Siamgas And Petrochemicals  vs.  CSSC Offshore Marine

Siamgas And Petroche

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Siamgas And Petrochemicals has generated negative risk-adjusted returns adding no value to investors with long positions. 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.

CSSC Offshore Marine

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CSSC Offshore Marine has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, CSSC Offshore is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Siamgas and CSSC Offshore

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

The idea behind Siamgas And Petrochemicals and CSSC Offshore Marine 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.