Correlation Between TMBThanachart Bank and Ally Financial
Can any of the company-specific risk be diversified away by investing in both TMBThanachart Bank and Ally 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 Ally 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 Ally Financial, you can compare the effects of market volatilities on TMBThanachart Bank and Ally 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 Ally Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of TMBThanachart Bank and Ally Financial.
Diversification Opportunities for TMBThanachart Bank and Ally Financial
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between TMBThanachart and Ally is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding TMBThanachart Bank Public and Ally Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ally Financial 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 Ally Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ally Financial has no effect on the direction of TMBThanachart Bank i.e., TMBThanachart Bank and Ally Financial go up and down completely randomly.
Pair Corralation between TMBThanachart Bank and Ally Financial
Assuming the 90 days trading horizon TMBThanachart Bank Public is expected to under-perform the Ally Financial. In addition to that, TMBThanachart Bank is 1.03 times more volatile than Ally Financial. It trades about -0.01 of its total potential returns per unit of risk. Ally Financial is currently generating about 0.06 per unit of volatility. If you would invest 3,241 in Ally Financial on October 14, 2024 and sell it today you would earn a total of 208.00 from holding Ally Financial or generate 6.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TMBThanachart Bank Public vs. Ally Financial
Performance |
| Timeline |
| TMBThanachart Bank Public |
| Ally Financial |
TMBThanachart Bank and Ally Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TMBThanachart Bank and Ally Financial
The main advantage of trading using opposite TMBThanachart Bank and Ally Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TMBThanachart Bank position performs unexpectedly, Ally 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 Ally Financial will offset losses from the drop in Ally Financial's long position.| TMBThanachart Bank vs. Guangdong Investment Limited | TMBThanachart Bank vs. The Hongkong and | TMBThanachart Bank vs. HK Electric Investments | TMBThanachart Bank vs. Keck Seng Investments |
| Ally Financial vs. SINGAPORE AIRLINES | Ally Financial vs. Singapore Airlines Limited | Ally Financial vs. Q2M Managementberatung AG | Ally Financial vs. SOUTHWEST AIRLINES |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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