Correlation Between Akkhie Prakarn and Siam City

Can any of the company-specific risk be diversified away by investing in both Akkhie Prakarn and Siam City 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 Akkhie Prakarn and Siam City into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Akkhie Prakarn Public and Siam City Cement, you can compare the effects of market volatilities on Akkhie Prakarn and Siam City 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 Akkhie Prakarn with a short position of Siam City. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akkhie Prakarn and Siam City.

Diversification Opportunities for Akkhie Prakarn and Siam City

-0.12

Correlation Coefficient

Akkhie Prakarn  Siam City

Good diversification

The 3 months correlation between Akkhie and Siam is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Akkhie Prakarn Public and Siam City Cement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siam City Cement and Akkhie Prakarn 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 Akkhie Prakarn Public are associated (or correlated) with Siam City. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siam City Cement has no effect on the direction of Akkhie Prakarn i.e., Akkhie Prakarn and Siam City go up and down completely randomly.

Pair Corralation between Akkhie Prakarn and Siam City

Assuming the 90 days trading horizon Akkhie Prakarn Public is expected to under-perform the Siam City. In addition to that, Akkhie Prakarn is 1.31 times more volatile than Siam City Cement. It trades about -0.08 of its total potential returns per unit of risk. Siam City Cement is currently generating about 0.23 per unit of volatility. If you would invest  14,650  in Siam City Cement on October 10, 2024 and sell it today you would earn a total of  1,550  from holding Siam City Cement or generate 10.58% return on investment over 90 days.

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

Akkhie Prakarn Public  vs.  Siam City Cement

Akkhie Prakarn Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Akkhie Prakarn Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Siam City Cement

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Siam City Cement are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting fundamental indicators, Siam City sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Akkhie Prakarn and Siam City

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

The idea behind Akkhie Prakarn Public and Siam City Cement 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.