Correlation Between Singha Estate and Siri Prime

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

By analyzing existing cross correlation between Singha Estate Public and Siri Prime Office, you can compare the effects of market volatilities on Singha Estate and Siri Prime 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 Singha Estate with a short position of Siri Prime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Singha Estate and Siri Prime.

Diversification Opportunities for Singha Estate and Siri Prime

0.84

Correlation Coefficient

Singha Estate  Siri Prime

Very poor diversification

The 3 months correlation between Singha and Siri is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Singha Estate Public and Siri Prime Office in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siri Prime Office and Singha Estate 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 Singha Estate Public are associated (or correlated) with Siri Prime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siri Prime Office has no effect on the direction of Singha Estate i.e., Singha Estate and Siri Prime go up and down completely randomly.

Pair Corralation between Singha Estate and Siri Prime

Given the investment horizon of 90 days Singha Estate Public is expected to under-perform the Siri Prime. In addition to that, Singha Estate is 1.51 times more volatile than Siri Prime Office. It trades about -0.2 of its total potential returns per unit of risk. Siri Prime Office is currently generating about -0.09 per unit of volatility. If you would invest  182.00  in Siri Prime Office on December 2, 2024 and sell it today you would lose (15.00) from holding Siri Prime Office or give up 8.24% of portfolio value over 90 days.

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

Singha Estate Public  vs.  Siri Prime Office

Singha Estate Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Singha Estate 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 quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Siri Prime Office

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Singha Estate and Siri Prime

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

The idea behind Singha Estate Public and Siri Prime Office 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.