Correlation Between Coor Service and TBC Bank

Can any of the company-specific risk be diversified away by investing in both Coor Service 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 Coor Service and TBC Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Coor Service Management and TBC Bank Group, you can compare the effects of market volatilities on Coor Service 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 Coor Service with a short position of TBC Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coor Service and TBC Bank.

Diversification Opportunities for Coor Service and TBC Bank

-0.81

Correlation Coefficient

Coor Service  TBC Bank

Pay attention - limited upside

The 3 months correlation between Coor and TBC is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Coor Service Management 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 Coor Service 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 Coor Service Management 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 Coor Service i.e., Coor Service and TBC Bank go up and down completely randomly.

Pair Corralation between Coor Service and TBC Bank

Assuming the 90 days trading horizon Coor Service Management is expected to generate 1.11 times more return on investment than TBC Bank. However, Coor Service is 1.11 times more volatile than TBC Bank Group. It trades about 0.27 of its potential returns per unit of risk. TBC Bank Group is currently generating about -0.13 per unit of risk. If you would invest  3,513  in Coor Service Management on October 12, 2024 and sell it today you would earn a total of  275.00  from holding Coor Service Management or generate 7.83% return on investment over 90 days.

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

Coor Service Management  vs.  TBC Bank Group

Coor Service Management

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Coor Service Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

TBC Bank Group

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in TBC Bank Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, TBC Bank unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Coor Service and TBC Bank

The main advantage of trading using opposite Coor Service and TBC Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coor Service 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.

The idea behind Coor Service Management and TBC Bank Group 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.