Correlation Between TFS FINANCIAL and KBC Ancora
Can any of the company-specific risk be diversified away by investing in both TFS FINANCIAL and KBC Ancora 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 TFS FINANCIAL and KBC Ancora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TFS FINANCIAL and KBC Ancora SCA, you can compare the effects of market volatilities on TFS FINANCIAL and KBC Ancora 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 TFS FINANCIAL with a short position of KBC Ancora. Check out your portfolio center. Please also check ongoing floating volatility patterns of TFS FINANCIAL and KBC Ancora.
Diversification Opportunities for TFS FINANCIAL and KBC Ancora
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between TFS and KBC is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding TFS FINANCIAL and KBC Ancora SCA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KBC Ancora SCA and TFS FINANCIAL 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 TFS FINANCIAL are associated (or correlated) with KBC Ancora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KBC Ancora SCA has no effect on the direction of TFS FINANCIAL i.e., TFS FINANCIAL and KBC Ancora go up and down completely randomly.
Pair Corralation between TFS FINANCIAL and KBC Ancora
Assuming the 90 days trading horizon TFS FINANCIAL is expected to under-perform the KBC Ancora. In addition to that, TFS FINANCIAL is 1.23 times more volatile than KBC Ancora SCA. It trades about -0.02 of its total potential returns per unit of risk. KBC Ancora SCA is currently generating about 0.03 per unit of volatility. If you would invest 4,775 in KBC Ancora SCA on September 13, 2024 and sell it today you would earn a total of 25.00 from holding KBC Ancora SCA or generate 0.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TFS FINANCIAL vs. KBC Ancora SCA
Performance |
| Timeline |
| TFS FINANCIAL |
| KBC Ancora SCA |
TFS FINANCIAL and KBC Ancora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TFS FINANCIAL and KBC Ancora
The main advantage of trading using opposite TFS FINANCIAL and KBC Ancora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TFS FINANCIAL position performs unexpectedly, KBC Ancora 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 KBC Ancora will offset losses from the drop in KBC Ancora's long position.| TFS FINANCIAL vs. Apple Inc | TFS FINANCIAL vs. Apple Inc | TFS FINANCIAL vs. Apple Inc | TFS FINANCIAL vs. Apple Inc |
| KBC Ancora vs. Vulcan Materials | KBC Ancora vs. Compagnie Plastic Omnium | KBC Ancora vs. Spirent Communications plc | KBC Ancora vs. Hyster Yale Materials Handling |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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