Correlation Between Standard Bank and Teb Bancorp
Can any of the company-specific risk be diversified away by investing in both Standard Bank and Teb Bancorp 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 Standard Bank and Teb Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Standard Bank Group and Teb Bancorp, you can compare the effects of market volatilities on Standard Bank and Teb Bancorp 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 Standard Bank with a short position of Teb Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Standard Bank and Teb Bancorp.
Diversification Opportunities for Standard Bank and Teb Bancorp
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Standard and Teb is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Standard Bank Group and Teb Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teb Bancorp and Standard 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 Standard Bank Group are associated (or correlated) with Teb Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teb Bancorp has no effect on the direction of Standard Bank i.e., Standard Bank and Teb Bancorp go up and down completely randomly.
Pair Corralation between Standard Bank and Teb Bancorp
Assuming the 90 days horizon Standard Bank Group is expected to under-perform the Teb Bancorp. But the pink sheet apears to be less risky and, when comparing its historical volatility, Standard Bank Group is 5.62 times less risky than Teb Bancorp. The pink sheet trades about -0.4 of its potential returns per unit of risk. The Teb Bancorp is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 800.00 in Teb Bancorp on October 12, 2024 and sell it today you would lose (5.00) from holding Teb Bancorp or give up 0.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Standard Bank Group vs. Teb Bancorp
Performance |
| Timeline |
| Standard Bank Group |
| Teb Bancorp |
Standard Bank and Teb Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Standard Bank and Teb Bancorp
The main advantage of trading using opposite Standard Bank and Teb Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Standard Bank position performs unexpectedly, Teb Bancorp 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 Teb Bancorp will offset losses from the drop in Teb Bancorp's long position.| Standard Bank vs. Bank Central Asia | Standard Bank vs. Nedbank Group | Standard Bank vs. Kasikornbank Public Co | Standard Bank vs. KBC Groep NV |
| Teb Bancorp vs. Sound Financial Bancorp | Teb Bancorp vs. Finward Bancorp | Teb Bancorp vs. Franklin Financial Services | Teb Bancorp vs. Community West Bancshares |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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