Correlation Between Gaming and TMBThanachart Bank

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

By analyzing existing cross correlation between Gaming and Leisure and TMBThanachart Bank Public, you can compare the effects of market volatilities on Gaming and TMBThanachart 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 Gaming with a short position of TMBThanachart Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaming and TMBThanachart Bank.

Diversification Opportunities for Gaming and TMBThanachart Bank

-0.11

Correlation Coefficient

Gaming  TMBThanachart Bank

Good diversification

The 3 months correlation between Gaming and TMBThanachart is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Gaming and Leisure and TMBThanachart Bank Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TMBThanachart Bank Public and Gaming 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 Gaming and Leisure are associated (or correlated) with TMBThanachart Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TMBThanachart Bank Public has no effect on the direction of Gaming i.e., Gaming and TMBThanachart Bank go up and down completely randomly.

Pair Corralation between Gaming and TMBThanachart Bank

Assuming the 90 days horizon Gaming is expected to generate 1.42 times less return on investment than TMBThanachart Bank. But when comparing it to its historical volatility, Gaming and Leisure is 1.65 times less risky than TMBThanachart Bank. It trades about 0.06 of its potential returns per unit of risk. TMBThanachart Bank Public is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  4.10  in TMBThanachart Bank Public on October 9, 2024 and sell it today you would earn a total of  0.90  from holding TMBThanachart Bank Public or generate 21.95% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.6%
Values	Daily Returns

Gaming and Leisure  vs.  TMBThanachart Bank Public

Gaming and Leisure

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Gaming and Leisure are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Gaming is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

TMBThanachart Bank Public

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in TMBThanachart Bank Public are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, TMBThanachart Bank is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Gaming and TMBThanachart Bank

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

The idea behind Gaming and Leisure and TMBThanachart Bank 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 Transaction History module to view history of all your transactions and understand their impact on performance.