Correlation Between Roebuck Food and TBC Bank
Can any of the company-specific risk be diversified away by investing in both Roebuck Food and TBC Bank 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 Roebuck Food and TBC Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Roebuck Food Group and TBC Bank Group, you can compare the effects of market volatilities on Roebuck Food and TBC 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 Roebuck Food with a short position of TBC Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Roebuck Food and TBC Bank.
Diversification Opportunities for Roebuck Food and TBC Bank
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Roebuck and TBC is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Roebuck Food Group and TBC Bank Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TBC Bank Group and Roebuck Food 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 Roebuck Food Group are associated (or correlated) with TBC Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TBC Bank Group has no effect on the direction of Roebuck Food i.e., Roebuck Food and TBC Bank go up and down completely randomly.
Pair Corralation between Roebuck Food and TBC Bank
Assuming the 90 days trading horizon Roebuck Food Group is expected to under-perform the TBC Bank. But the stock apears to be less risky and, when comparing its historical volatility, Roebuck Food Group is 2.61 times less risky than TBC Bank. The stock trades about -0.15 of its potential returns per unit of risk. The TBC Bank Group is currently generating about 0.37 of returns per unit of risk over similar time horizon. If you would invest 297,500 in TBC Bank Group on December 12, 2024 and sell it today you would earn a total of 124,500 from holding TBC Bank Group or generate 41.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Roebuck Food Group vs. TBC Bank Group
Performance |
| Timeline |
| Roebuck Food Group |
| TBC Bank Group |
Roebuck Food and TBC Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Roebuck Food and TBC Bank
The main advantage of trading using opposite Roebuck Food and TBC Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Roebuck Food position performs unexpectedly, TBC 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 TBC Bank will offset losses from the drop in TBC Bank's long position.| Roebuck Food vs. Rheinmetall AG | ||
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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