Correlation Between Humanica Public and Siam Wellness

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

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

Diversification Opportunities for Humanica Public and Siam Wellness

-0.39

Correlation Coefficient

Humanica Public  Siam Wellness

Very good diversification

The 3 months correlation between Humanica and Siam is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Humanica Public and Siam Wellness Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siam Wellness Group and Humanica Public 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 Humanica Public are associated (or correlated) with Siam Wellness. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siam Wellness Group has no effect on the direction of Humanica Public i.e., Humanica Public and Siam Wellness go up and down completely randomly.

Pair Corralation between Humanica Public and Siam Wellness

Assuming the 90 days trading horizon Humanica Public is expected to under-perform the Siam Wellness. But the stock apears to be less risky and, when comparing its historical volatility, Humanica Public is 1.27 times less risky than Siam Wellness. The stock trades about -0.21 of its potential returns per unit of risk. The Siam Wellness Group is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  715.00  in Siam Wellness Group on September 15, 2024 and sell it today you would lose (25.00) from holding Siam Wellness Group or give up 3.5% of portfolio value over 90 days.

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

Humanica Public  vs.  Siam Wellness Group

Humanica Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Humanica 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 fundamental drivers remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Siam Wellness Group

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Humanica Public and Siam Wellness

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

The idea behind Humanica Public and Siam Wellness Group 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.

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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.