Correlation Between TISCO Financial and G J
Can any of the company-specific risk be diversified away by investing in both TISCO Financial and G J 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 G J 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 G J Steel, you can compare the effects of market volatilities on TISCO Financial and G J 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 G J. Check out your portfolio center. Please also check ongoing floating volatility patterns of TISCO Financial and G J.
Diversification Opportunities for TISCO Financial and G J
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between TISCO and GJS is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding TISCO Financial Group and G J Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G J Steel 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 G J. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G J Steel has no effect on the direction of TISCO Financial i.e., TISCO Financial and G J go up and down completely randomly.
Pair Corralation between TISCO Financial and G J
Assuming the 90 days trading horizon TISCO Financial is expected to generate 51.8 times less return on investment than G J. But when comparing it to its historical volatility, TISCO Financial Group is 77.7 times less risky than G J. It trades about 0.06 of its potential returns per unit of risk. G J Steel is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 34.00 in G J Steel on September 14, 2024 and sell it today you would lose (18.00) from holding G J Steel or give up 52.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TISCO Financial Group vs. G J Steel
Performance |
| Timeline |
| TISCO Financial Group |
| G J Steel |
TISCO Financial and G J Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TISCO Financial and G J
The main advantage of trading using opposite TISCO Financial and G J positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TISCO Financial position performs unexpectedly, G J 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 G J will offset losses from the drop in G J'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 |
| G J vs. POSCO Thainox Public | G J vs. Aqua Public | G J vs. Better World Green | G J vs. Eternal Energy 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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