Correlation Between TMBThanachart Bank and COSTCO WHOLESALE
Can any of the company-specific risk be diversified away by investing in both TMBThanachart Bank and COSTCO WHOLESALE 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 COSTCO WHOLESALE 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 COSTCO WHOLESALE CDR, you can compare the effects of market volatilities on TMBThanachart Bank and COSTCO WHOLESALE 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 COSTCO WHOLESALE. Check out your portfolio center. Please also check ongoing floating volatility patterns of TMBThanachart Bank and COSTCO WHOLESALE.
Diversification Opportunities for TMBThanachart Bank and COSTCO WHOLESALE
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between TMBThanachart and COSTCO is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding TMBThanachart Bank Public and COSTCO WHOLESALE CDR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COSTCO WHOLESALE CDR 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 COSTCO WHOLESALE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COSTCO WHOLESALE CDR has no effect on the direction of TMBThanachart Bank i.e., TMBThanachart Bank and COSTCO WHOLESALE go up and down completely randomly.
Pair Corralation between TMBThanachart Bank and COSTCO WHOLESALE
Assuming the 90 days trading horizon TMBThanachart Bank is expected to generate 9.18 times less return on investment than COSTCO WHOLESALE. But when comparing it to its historical volatility, TMBThanachart Bank Public is 1.73 times less risky than COSTCO WHOLESALE. It trades about 0.05 of its potential returns per unit of risk. COSTCO WHOLESALE CDR is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 2,715 in COSTCO WHOLESALE CDR on August 29, 2024 and sell it today you would earn a total of 285.00 from holding COSTCO WHOLESALE CDR or generate 10.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
TMBThanachart Bank Public vs. COSTCO WHOLESALE CDR
Performance |
| Timeline |
| TMBThanachart Bank Public |
| COSTCO WHOLESALE CDR |
TMBThanachart Bank and COSTCO WHOLESALE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TMBThanachart Bank and COSTCO WHOLESALE
The main advantage of trading using opposite TMBThanachart Bank and COSTCO WHOLESALE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TMBThanachart Bank position performs unexpectedly, COSTCO WHOLESALE 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 COSTCO WHOLESALE will offset losses from the drop in COSTCO WHOLESALE's long position.| TMBThanachart Bank vs. COSTCO WHOLESALE CDR | TMBThanachart Bank vs. FAST RETAIL ADR | TMBThanachart Bank vs. GAMING FAC SA | TMBThanachart Bank vs. MARKET VECTR RETAIL |
| COSTCO WHOLESALE vs. Walmart | COSTCO WHOLESALE vs. Walmart | COSTCO WHOLESALE vs. Costco Wholesale | COSTCO WHOLESALE vs. Target |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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