Correlation Between Siam Commercial and Thanachart Capital

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

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

Diversification Opportunities for Siam Commercial and Thanachart Capital

0.86

Correlation Coefficient

Siam Commercial  Thanachart Capital

Very poor diversification

The 3 months correlation between Siam and Thanachart is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding The Siam Commercial and Thanachart Capital Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thanachart Capital Public and Siam Commercial 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 The Siam Commercial are associated (or correlated) with Thanachart Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thanachart Capital Public has no effect on the direction of Siam Commercial i.e., Siam Commercial and Thanachart Capital go up and down completely randomly.

Pair Corralation between Siam Commercial and Thanachart Capital

Assuming the 90 days trading horizon The Siam Commercial is expected to generate 0.76 times more return on investment than Thanachart Capital. However, The Siam Commercial is 1.32 times less risky than Thanachart Capital. It trades about -0.06 of its potential returns per unit of risk. Thanachart Capital Public is currently generating about -0.08 per unit of risk. If you would invest  12,537  in The Siam Commercial on April 23, 2025 and sell it today you would lose (437.00) from holding The Siam Commercial or give up 3.49% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.31%
Values	Daily Returns

The Siam Commercial  vs.  Thanachart Capital Public

Siam Commercial

Risk-Adjusted Performance

Very Weak

Over the last 90 days The Siam Commercial has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, Siam Commercial is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Thanachart Capital Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Thanachart Capital Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Siam Commercial and Thanachart Capital

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

The idea behind The Siam Commercial and Thanachart Capital Public 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.