Correlation Between TISCO Financial and MCS Steel
Can any of the company-specific risk be diversified away by investing in both TISCO Financial and MCS Steel 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 MCS Steel 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 MCS Steel Public, you can compare the effects of market volatilities on TISCO Financial and MCS Steel 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 MCS Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of TISCO Financial and MCS Steel.
Diversification Opportunities for TISCO Financial and MCS Steel
-0.93 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between TISCO and MCS is -0.93. Overlapping area represents the amount of risk that can be diversified away by holding TISCO Financial Group and MCS Steel Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MCS Steel Public 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 MCS Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MCS Steel Public has no effect on the direction of TISCO Financial i.e., TISCO Financial and MCS Steel go up and down completely randomly.
Pair Corralation between TISCO Financial and MCS Steel
Assuming the 90 days trading horizon TISCO Financial is expected to generate 82.94 times less return on investment than MCS Steel. But when comparing it to its historical volatility, TISCO Financial Group is 164.25 times less risky than MCS Steel. It trades about 0.16 of its potential returns per unit of risk. MCS Steel Public is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 628.00 in MCS Steel Public on November 3, 2024 and sell it today you would lose (8.00) from holding MCS Steel Public or give up 1.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TISCO Financial Group vs. MCS Steel Public
Performance |
| Timeline |
| TISCO Financial Group |
| MCS Steel Public |
TISCO Financial and MCS Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TISCO Financial and MCS Steel
The main advantage of trading using opposite TISCO Financial and MCS Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TISCO Financial position performs unexpectedly, MCS Steel 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 MCS Steel will offset losses from the drop in MCS Steel'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 |
| MCS Steel vs. Lalin Property Public | MCS Steel vs. Land and Houses | MCS Steel vs. Banpu Public | MCS Steel vs. TISCO Financial Group |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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