Correlation Between Bodhi Tree and CSB Bank
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By analyzing existing cross correlation between Bodhi Tree Multimedia and CSB Bank Limited, you can compare the effects of market volatilities on Bodhi Tree and CSB 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 Bodhi Tree with a short position of CSB Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bodhi Tree and CSB Bank.
Diversification Opportunities for Bodhi Tree and CSB Bank
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bodhi and CSB is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Bodhi Tree Multimedia and CSB Bank Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSB Bank Limited and Bodhi Tree 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 Bodhi Tree Multimedia are associated (or correlated) with CSB Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSB Bank Limited has no effect on the direction of Bodhi Tree i.e., Bodhi Tree and CSB Bank go up and down completely randomly.
Pair Corralation between Bodhi Tree and CSB Bank
Assuming the 90 days trading horizon Bodhi Tree Multimedia is expected to under-perform the CSB Bank. In addition to that, Bodhi Tree is 1.87 times more volatile than CSB Bank Limited. It trades about -0.14 of its total potential returns per unit of risk. CSB Bank Limited is currently generating about -0.18 per unit of volatility. If you would invest 30,270 in CSB Bank Limited on November 30, 2024 and sell it today you would lose (2,225) from holding CSB Bank Limited or give up 7.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bodhi Tree Multimedia vs. CSB Bank Limited
Performance |
| Timeline |
| Bodhi Tree Multimedia |
| CSB Bank Limited |
Bodhi Tree and CSB Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bodhi Tree and CSB Bank
The main advantage of trading using opposite Bodhi Tree and CSB Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bodhi Tree position performs unexpectedly, CSB 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 CSB Bank will offset losses from the drop in CSB Bank's long position.| Bodhi Tree vs. Union Bank of | ||
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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