Correlation Between State Bank and TINC Comm
Can any of the company-specific risk be diversified away by investing in both State Bank and TINC Comm 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 State Bank and TINC Comm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between State Bank of and TINC Comm VA, you can compare the effects of market volatilities on State Bank and TINC Comm 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 State Bank with a short position of TINC Comm. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Bank and TINC Comm.
Diversification Opportunities for State Bank and TINC Comm
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between State and TINC is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding State Bank of and TINC Comm VA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TINC Comm VA and State 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 State Bank of are associated (or correlated) with TINC Comm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TINC Comm VA has no effect on the direction of State Bank i.e., State Bank and TINC Comm go up and down completely randomly.
Pair Corralation between State Bank and TINC Comm
Assuming the 90 days horizon State Bank of is expected to generate 1.83 times more return on investment than TINC Comm. However, State Bank is 1.83 times more volatile than TINC Comm VA. It trades about 0.08 of its potential returns per unit of risk. TINC Comm VA is currently generating about 0.0 per unit of risk. If you would invest 6,675 in State Bank of on September 4, 2024 and sell it today you would earn a total of 2,675 from holding State Bank of or generate 40.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
State Bank of vs. TINC Comm VA
Performance |
| Timeline |
| State Bank |
| TINC Comm VA |
State Bank and TINC Comm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Bank and TINC Comm
The main advantage of trading using opposite State Bank and TINC Comm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State Bank position performs unexpectedly, TINC Comm 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 TINC Comm will offset losses from the drop in TINC Comm's long position.| State Bank vs. Ming Le Sports | State Bank vs. United Breweries Co | State Bank vs. VIAPLAY GROUP AB | State Bank vs. Thai Beverage Public |
| TINC Comm vs. Blackstone Group | TINC Comm vs. BlackRock | TINC Comm vs. The Bank of | TINC Comm vs. Ameriprise Financial |
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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