Correlation Between TKB Critical and Chiba Bank

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

By analyzing existing cross correlation between TKB Critical Technologies and Chiba Bank Ltd, you can compare the effects of market volatilities on TKB Critical and Chiba 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 TKB Critical with a short position of Chiba Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of TKB Critical and Chiba Bank.

Diversification Opportunities for TKB Critical and Chiba Bank

0.0

Correlation Coefficient

TKB Critical  Chiba Bank

Pay attention - limited upside

The 3 months correlation between TKB and Chiba is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding TKB Critical Technologies and Chiba Bank Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chiba Bank and TKB Critical 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 TKB Critical Technologies are associated (or correlated) with Chiba Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chiba Bank has no effect on the direction of TKB Critical i.e., TKB Critical and Chiba Bank go up and down completely randomly.

Pair Corralation between TKB Critical and Chiba Bank

If you would invest  3,768  in Chiba Bank Ltd on December 27, 2024 and sell it today you would earn a total of  0.00  from holding Chiba Bank Ltd or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

TKB Critical Technologies  vs.  Chiba Bank Ltd

TKB Critical Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days TKB Critical Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, TKB Critical is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Chiba Bank

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chiba Bank Ltd has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Chiba Bank is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with TKB Critical and Chiba Bank

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

The idea behind TKB Critical Technologies and Chiba Bank Ltd 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.

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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.