Correlation Between Siam Cement and BTS Group

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

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

Diversification Opportunities for Siam Cement and BTS Group

-0.61

Correlation Coefficient

Siam Cement  BTS Group

Excellent diversification

The 3 months correlation between Siam and BTS is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding The Siam Cement and BTS Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTS Group Holdings and Siam Cement 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 Cement are associated (or correlated) with BTS Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTS Group Holdings has no effect on the direction of Siam Cement i.e., Siam Cement and BTS Group go up and down completely randomly.

Pair Corralation between Siam Cement and BTS Group

Assuming the 90 days trading horizon The Siam Cement is expected to generate 0.51 times more return on investment than BTS Group. However, The Siam Cement is 1.97 times less risky than BTS Group. It trades about 0.18 of its potential returns per unit of risk. BTS Group Holdings is currently generating about -0.14 per unit of risk. If you would invest  15,200  in The Siam Cement on April 24, 2025 and sell it today you would earn a total of  4,050  from holding The Siam Cement or generate 26.64% return on investment over 90 days.

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

The Siam Cement  vs.  BTS Group Holdings

Siam Cement

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in The Siam Cement are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting fundamental indicators, Siam Cement disclosed solid returns over the last few months and may actually be approaching a breakup point.

BTS Group Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days BTS Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Siam Cement and BTS Group

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

The idea behind The Siam Cement and BTS Group Holdings 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.