Correlation Between Stock Exchange and TCM Public
Can any of the company-specific risk be diversified away by investing in both Stock Exchange and TCM Public 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 Stock Exchange and TCM Public into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stock Exchange Of and TCM Public, you can compare the effects of market volatilities on Stock Exchange and TCM Public 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 Stock Exchange with a short position of TCM Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stock Exchange and TCM Public.
Diversification Opportunities for Stock Exchange and TCM Public
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Stock and TCM is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Stock Exchange Of and TCM Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TCM Public and Stock Exchange 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 Stock Exchange Of are associated (or correlated) with TCM Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TCM Public has no effect on the direction of Stock Exchange i.e., Stock Exchange and TCM Public go up and down completely randomly.
Pair Corralation between Stock Exchange and TCM Public
Assuming the 90 days trading horizon Stock Exchange Of is expected to under-perform the TCM Public. But the index apears to be less risky and, when comparing its historical volatility, Stock Exchange Of is 73.73 times less risky than TCM Public. The index trades about -0.03 of its potential returns per unit of risk. The TCM Public is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 194.00 in TCM Public on August 31, 2024 and sell it today you would lose (123.00) from holding TCM Public or give up 63.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stock Exchange Of vs. TCM Public
Performance |
| Timeline |
Stock Exchange and TCM Public Volatility Contrast
Predicted Return Density |
| Returns |
Stock Exchange Of
Pair trading matchups for Stock Exchange
TCM Public
Pair trading matchups for TCM Public
Pair Trading with Stock Exchange and TCM Public
The main advantage of trading using opposite Stock Exchange and TCM Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stock Exchange position performs unexpectedly, TCM Public 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 TCM Public will offset losses from the drop in TCM Public's long position.| Stock Exchange vs. Jasmine Telecom Systems | Stock Exchange vs. TMBThanachart Bank Public | Stock Exchange vs. Information and Communication | Stock Exchange vs. TISCO Financial Group |
| TCM Public vs. STPI Public | TCM Public vs. Thai Vegetable Oil | TCM Public vs. Tycoons Worldwide Group | TCM Public vs. Ratchthani Leasing Public |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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