Correlation Between Touchmark Bancshares and SVB T

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

By analyzing existing cross correlation between Touchmark Bancshares and SVB T Corp, you can compare the effects of market volatilities on Touchmark Bancshares and SVB T 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 Touchmark Bancshares with a short position of SVB T. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchmark Bancshares and SVB T.

Diversification Opportunities for Touchmark Bancshares and SVB T

-0.56

Correlation Coefficient

Touchmark Bancshares  SVB T

Excellent diversification

The 3 months correlation between Touchmark and SVB is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Touchmark Bancshares and SVB T Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SVB T Corp and Touchmark Bancshares 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 Touchmark Bancshares are associated (or correlated) with SVB T. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SVB T Corp has no effect on the direction of Touchmark Bancshares i.e., Touchmark Bancshares and SVB T go up and down completely randomly.

Pair Corralation between Touchmark Bancshares and SVB T

Given the investment horizon of 90 days Touchmark Bancshares is expected to generate 5.35 times more return on investment than SVB T. However, Touchmark Bancshares is 5.35 times more volatile than SVB T Corp. It trades about 0.22 of its potential returns per unit of risk. SVB T Corp is currently generating about -0.08 per unit of risk. If you would invest  770.00  in Touchmark Bancshares on September 17, 2024 and sell it today you would earn a total of  37.00  from holding Touchmark Bancshares or generate 4.81% return on investment over 90 days.

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

Touchmark Bancshares  vs.  SVB T Corp

Touchmark Bancshares

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Touchmark Bancshares has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

SVB T Corp

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SVB T Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable fundamental drivers, SVB T is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Touchmark Bancshares and SVB T

The main advantage of trading using opposite Touchmark Bancshares and SVB T positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchmark Bancshares position performs unexpectedly, SVB T 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 SVB T will offset losses from the drop in SVB T's long position.

The idea behind Touchmark Bancshares and SVB T Corp 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.