Correlation Between TMBThanachart Bank and TISCO Financial

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Can any of the company-specific risk be diversified away by investing in both TMBThanachart Bank and TISCO Financial 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 TMBThanachart Bank and TISCO Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TMBThanachart Bank Public and TISCO Financial Group, you can compare the effects of market volatilities on TMBThanachart Bank and TISCO Financial 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 TMBThanachart Bank with a short position of TISCO Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of TMBThanachart Bank and TISCO Financial.

Diversification Opportunities for TMBThanachart Bank and TISCO Financial

TMBThanachartTISCODiversified AwayTMBThanachartTISCODiversified Away100%
0.49
  Correlation Coefficient

Very weak diversification

The 3 months correlation between TMBThanachart and TISCO is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding TMBThanachart Bank Public and TISCO Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TISCO Financial Group and TMBThanachart Bank 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 TMBThanachart Bank Public are associated (or correlated) with TISCO Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TISCO Financial Group has no effect on the direction of TMBThanachart Bank i.e., TMBThanachart Bank and TISCO Financial go up and down completely randomly.

Pair Corralation between TMBThanachart Bank and TISCO Financial

Assuming the 90 days trading horizon TMBThanachart Bank Public is expected to generate 2.44 times more return on investment than TISCO Financial. However, TMBThanachart Bank is 2.44 times more volatile than TISCO Financial Group. It trades about 0.12 of its potential returns per unit of risk. TISCO Financial Group is currently generating about 0.1 per unit of risk. If you would invest  179.00  in TMBThanachart Bank Public on November 19, 2024 and sell it today you would earn a total of  15.00  from holding TMBThanachart Bank Public or generate 8.38% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy98.36%
ValuesDaily Returns

TMBThanachart Bank Public  vs.  TISCO Financial Group

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb 0510
JavaScript chart by amCharts 3.21.15TTB TISCO
       Timeline  
TMBThanachart Bank Public 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in TMBThanachart Bank Public are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite weak fundamental drivers, TMBThanachart Bank may actually be approaching a critical reversion point that can send shares even higher in March 2025.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1.751.81.851.91.952
TISCO Financial Group 

Risk-Adjusted Performance

Modest

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in TISCO Financial Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, TISCO Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb96979899100

TMBThanachart Bank and TISCO Financial Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.68-2.76-1.83-0.910.00.961.942.913.89 0.51.01.5
JavaScript chart by amCharts 3.21.15TTB TISCO
       Returns  

Pair Trading with TMBThanachart Bank and TISCO Financial

The main advantage of trading using opposite TMBThanachart Bank and TISCO Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TMBThanachart Bank position performs unexpectedly, TISCO Financial 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 TISCO Financial will offset losses from the drop in TISCO Financial's long position.
The idea behind TMBThanachart Bank Public and TISCO Financial 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.

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