Correlation Between TISCO Financial and AEON Thana
Can any of the company-specific risk be diversified away by investing in both TISCO Financial and AEON Thana 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 TISCO Financial and AEON Thana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TISCO Financial Group and AEON Thana Sinsap, you can compare the effects of market volatilities on TISCO Financial and AEON Thana 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 TISCO Financial with a short position of AEON Thana. Check out your portfolio center. Please also check ongoing floating volatility patterns of TISCO Financial and AEON Thana.
Diversification Opportunities for TISCO Financial and AEON Thana
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TISCO and AEON is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding TISCO Financial Group and AEON Thana Sinsap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEON Thana Sinsap and TISCO Financial 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 TISCO Financial Group are associated (or correlated) with AEON Thana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEON Thana Sinsap has no effect on the direction of TISCO Financial i.e., TISCO Financial and AEON Thana go up and down completely randomly.
Pair Corralation between TISCO Financial and AEON Thana
Assuming the 90 days trading horizon TISCO Financial Group is expected to generate 0.33 times more return on investment than AEON Thana. However, TISCO Financial Group is 3.01 times less risky than AEON Thana. It trades about 0.06 of its potential returns per unit of risk. AEON Thana Sinsap is currently generating about -0.02 per unit of risk. If you would invest 8,243 in TISCO Financial Group on September 2, 2024 and sell it today you would earn a total of 1,407 from holding TISCO Financial Group or generate 17.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TISCO Financial Group vs. AEON Thana Sinsap
Performance |
| Timeline |
| TISCO Financial Group |
| AEON Thana Sinsap |
TISCO Financial and AEON Thana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TISCO Financial and AEON Thana
The main advantage of trading using opposite TISCO Financial and AEON Thana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TISCO Financial position performs unexpectedly, AEON Thana 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 AEON Thana will offset losses from the drop in AEON Thana's long position.| TISCO Financial vs. Kasikornbank Public | TISCO Financial vs. Kiatnakin Phatra Bank | TISCO Financial vs. SCB X Public | TISCO Financial vs. Bangkok Bank Public |
| AEON Thana vs. Krungthai Card PCL | AEON Thana vs. Carabao Group Public | AEON Thana vs. Kasikornbank Public | AEON Thana vs. Advanced Info Service |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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