Correlation Between SiamEast Solutions and Thai Mui

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

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

Diversification Opportunities for SiamEast Solutions and Thai Mui

0.92

Correlation Coefficient

SiamEast Solutions  Thai Mui

Almost no diversification

The 3 months correlation between SiamEast and Thai is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding SiamEast Solutions Public and Thai Mui in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thai Mui and SiamEast Solutions 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 SiamEast Solutions Public are associated (or correlated) with Thai Mui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thai Mui has no effect on the direction of SiamEast Solutions i.e., SiamEast Solutions and Thai Mui go up and down completely randomly.

Pair Corralation between SiamEast Solutions and Thai Mui

Assuming the 90 days horizon SiamEast Solutions is expected to generate 1.03 times less return on investment than Thai Mui. In addition to that, SiamEast Solutions is 1.0 times more volatile than Thai Mui. It trades about 0.12 of its total potential returns per unit of risk. Thai Mui is currently generating about 0.13 per unit of volatility. If you would invest  0.00  in Thai Mui on September 3, 2024 and sell it today you would earn a total of  57.00  from holding Thai Mui or generate 9.223372036854776E16% return on investment over 90 days.

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

SiamEast Solutions Public  vs.  Thai Mui

SiamEast Solutions Public

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SiamEast Solutions Public are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental drivers, SiamEast Solutions disclosed solid returns over the last few months and may actually be approaching a breakup point.

Thai Mui

Risk-Adjusted Performance

9 of 100

OK

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

Pair Trading with SiamEast Solutions and Thai Mui

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

The idea behind SiamEast Solutions Public and Thai Mui 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.