Correlation Between Seche Environnement and TBC Bank
Can any of the company-specific risk be diversified away by investing in both Seche Environnement and TBC Bank 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 Seche Environnement and TBC Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Seche Environnement SA and TBC Bank Group, you can compare the effects of market volatilities on Seche Environnement and TBC Bank 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 Seche Environnement with a short position of TBC Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Seche Environnement and TBC Bank.
Diversification Opportunities for Seche Environnement and TBC Bank
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Seche and TBC is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Seche Environnement SA and TBC Bank Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TBC Bank Group and Seche Environnement 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 Seche Environnement SA are associated (or correlated) with TBC Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TBC Bank Group has no effect on the direction of Seche Environnement i.e., Seche Environnement and TBC Bank go up and down completely randomly.
Pair Corralation between Seche Environnement and TBC Bank
Assuming the 90 days trading horizon Seche Environnement SA is expected to under-perform the TBC Bank. But the stock apears to be less risky and, when comparing its historical volatility, Seche Environnement SA is 1.17 times less risky than TBC Bank. The stock trades about -0.01 of its potential returns per unit of risk. The TBC Bank Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 196,717 in TBC Bank Group on October 11, 2024 and sell it today you would earn a total of 108,283 from holding TBC Bank Group or generate 55.05% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 99.0% |
Values | Daily Returns |
Seche Environnement SA vs. TBC Bank Group
Performance |
Timeline |
Seche Environnement |
TBC Bank Group |
Seche Environnement and TBC Bank Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Seche Environnement and TBC Bank
The main advantage of trading using opposite Seche Environnement and TBC Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Seche Environnement position performs unexpectedly, TBC Bank 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 TBC Bank will offset losses from the drop in TBC Bank's long position.Seche Environnement vs. Silver Bullet Data | Seche Environnement vs. Applied Materials | Seche Environnement vs. Elmos Semiconductor SE | Seche Environnement vs. Datalogic |
TBC Bank vs. Seche Environnement SA | TBC Bank vs. JLEN Environmental Assets | TBC Bank vs. Global Net Lease | TBC Bank vs. Broadcom |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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