Correlation Between Haad Thip and Siam City

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

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

Diversification Opportunities for Haad Thip and Siam City

0.61

Correlation Coefficient

Haad Thip  Siam City

Poor diversification

The 3 months correlation between Haad and Siam is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Haad Thip 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 Haad Thip 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 Haad Thip 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 Haad Thip i.e., Haad Thip and Siam City go up and down completely randomly.

Pair Corralation between Haad Thip and Siam City

Assuming the 90 days trading horizon Haad Thip Public is expected to under-perform the Siam City. In addition to that, Haad Thip is 1.36 times more volatile than Siam City Cement. It trades about -0.09 of its total potential returns per unit of risk. Siam City Cement is currently generating about -0.07 per unit of volatility. If you would invest  16,750  in Siam City Cement on October 24, 2024 and sell it today you would lose (650.00) from holding Siam City Cement or give up 3.88% of portfolio value over 90 days.

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

Haad Thip Public  vs.  Siam City Cement

Haad Thip Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Haad Thip Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's fundamental indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Siam City Cement

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Siam City Cement has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Siam City is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Haad Thip and Siam City

The main advantage of trading using opposite Haad Thip and Siam City positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Haad Thip 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 Haad Thip 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.