Correlation Between Asia Plus and TISCO Financial
Can any of the company-specific risk be diversified away by investing in both Asia Plus 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 Asia Plus and TISCO Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asia Plus Group and TISCO Financial Group, you can compare the effects of market volatilities on Asia Plus 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 Asia Plus with a short position of TISCO Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Plus and TISCO Financial.
Diversification Opportunities for Asia Plus and TISCO Financial
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Asia and TISCO is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Asia Plus Group 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 Asia Plus 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 Asia Plus Group 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 Asia Plus i.e., Asia Plus and TISCO Financial go up and down completely randomly.
Pair Corralation between Asia Plus and TISCO Financial
Assuming the 90 days trading horizon Asia Plus Group is expected to generate 2.82 times more return on investment than TISCO Financial. However, Asia Plus is 2.82 times more volatile than TISCO Financial Group. It trades about 0.08 of its potential returns per unit of risk. TISCO Financial Group is currently generating about 0.09 per unit of risk. If you would invest 226.00 in Asia Plus Group on September 2, 2024 and sell it today you would earn a total of 18.00 from holding Asia Plus Group or generate 7.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Plus Group vs. TISCO Financial Group
Performance |
| Timeline |
| Asia Plus Group |
| TISCO Financial Group |
Asia Plus and TISCO Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Plus and TISCO Financial
The main advantage of trading using opposite Asia Plus and TISCO Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Plus 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.| Asia Plus vs. KGI Securities Public | Asia Plus vs. Bangkok Bank Public | Asia Plus vs. Land and Houses | Asia Plus vs. Italian Thai Development Public |
| TISCO Financial vs. Kasikornbank Public | TISCO Financial vs. Kiatnakin Phatra Bank | TISCO Financial vs. SCB X Public | TISCO Financial vs. Bangkok Bank Public |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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