Correlation Between TBC Bank and Delta Air
Can any of the company-specific risk be diversified away by investing in both TBC Bank and Delta Air 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 TBC Bank and Delta Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TBC Bank Group and Delta Air Lines, you can compare the effects of market volatilities on TBC Bank and Delta Air 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 TBC Bank with a short position of Delta Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of TBC Bank and Delta Air.
Diversification Opportunities for TBC Bank and Delta Air
Poor diversification
The 3 months correlation between TBC and Delta is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding TBC Bank Group and Delta Air Lines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delta Air Lines and TBC 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 TBC Bank Group are associated (or correlated) with Delta Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delta Air Lines has no effect on the direction of TBC Bank i.e., TBC Bank and Delta Air go up and down completely randomly.
Pair Corralation between TBC Bank and Delta Air
Assuming the 90 days trading horizon TBC Bank is expected to generate 2.17 times less return on investment than Delta Air. But when comparing it to its historical volatility, TBC Bank Group is 1.33 times less risky than Delta Air. It trades about 0.2 of its potential returns per unit of risk. Delta Air Lines is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 5,903 in Delta Air Lines on November 2, 2024 and sell it today you would earn a total of 970.00 from holding Delta Air Lines or generate 16.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TBC Bank Group vs. Delta Air Lines
Performance |
| Timeline |
| TBC Bank Group |
| Delta Air Lines |
TBC Bank and Delta Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TBC Bank and Delta Air
The main advantage of trading using opposite TBC Bank and Delta Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TBC Bank position performs unexpectedly, Delta Air 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 Delta Air will offset losses from the drop in Delta Air's long position.| TBC Bank vs. Sligro Food Group | TBC Bank vs. Delta Air Lines | TBC Bank vs. Leroy Seafood Group | TBC Bank vs. Hochschild Mining plc |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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