Correlation Between Sriracha Construction and Siam Cement

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

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

Diversification Opportunities for Sriracha Construction and Siam Cement

0.61

Correlation Coefficient

Sriracha Construction  Siam Cement

Poor diversification

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

Pair Corralation between Sriracha Construction and Siam Cement

Assuming the 90 days trading horizon Sriracha Construction Public is expected to generate 1.53 times more return on investment than Siam Cement. However, Sriracha Construction is 1.53 times more volatile than The Siam Cement. It trades about 0.37 of its potential returns per unit of risk. The Siam Cement is currently generating about 0.18 per unit of risk. If you would invest  390.00  in Sriracha Construction Public on April 24, 2025 and sell it today you would earn a total of  450.00  from holding Sriracha Construction Public or generate 115.38% return on investment over 90 days.

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

Sriracha Construction Public  vs.  The Siam Cement

Sriracha Construction

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Sriracha Construction Public are ranked lower than 28 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting forward indicators, Sriracha Construction sustained solid returns over the last few months and may actually be approaching a breakup point.

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.

Pair Trading with Sriracha Construction and Siam Cement

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

The idea behind Sriracha Construction Public and The Siam Cement 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 Transaction History module to view history of all your transactions and understand their impact on performance.