Correlation Between Information and Siam Wellness

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

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

Diversification Opportunities for Information and Siam Wellness

0.46

Correlation Coefficient

Information  Siam Wellness

Very weak diversification

The 3 months correlation between Information and Siam is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Information and Communication 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 Information 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 Information and Communication 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 Information i.e., Information and Siam Wellness go up and down completely randomly.

Pair Corralation between Information and Siam Wellness

Assuming the 90 days trading horizon Information is expected to generate 1.7 times less return on investment than Siam Wellness. In addition to that, Information is 1.07 times more volatile than Siam Wellness Group. It trades about 0.06 of its total potential returns per unit of risk. Siam Wellness Group is currently generating about 0.1 per unit of volatility. If you would invest  635.00  in Siam Wellness Group on September 3, 2024 and sell it today you would earn a total of  85.00  from holding Siam Wellness Group or generate 13.39% return on investment over 90 days.

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

Information and Communication  vs.  Siam Wellness Group

Information and Comm

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Information and Communication are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Information may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Siam Wellness Group

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Siam Wellness Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Siam Wellness disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Information and Siam Wellness

The main advantage of trading using opposite Information and Siam Wellness positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Information 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 Information and Communication 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.

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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.