Correlation Between Ratchthani Leasing and TISCO Financial

Can any of the company-specific risk be diversified away by investing in both Ratchthani Leasing and TISCO Financial 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 Ratchthani Leasing and TISCO Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ratchthani Leasing Public and TISCO Financial Group, you can compare the effects of market volatilities on Ratchthani Leasing and TISCO Financial 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 Ratchthani Leasing with a short position of TISCO Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ratchthani Leasing and TISCO Financial.

Diversification Opportunities for Ratchthani Leasing and TISCO Financial

-0.19

Correlation Coefficient

Ratchthani Leasing  TISCO Financial

Good diversification

The 3 months correlation between Ratchthani and TISCO is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Ratchthani Leasing Public and TISCO Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TISCO Financial Group and Ratchthani Leasing 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 Ratchthani Leasing Public are associated (or correlated) with TISCO Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TISCO Financial Group has no effect on the direction of Ratchthani Leasing i.e., Ratchthani Leasing and TISCO Financial go up and down completely randomly.

Pair Corralation between Ratchthani Leasing and TISCO Financial

Assuming the 90 days trading horizon Ratchthani Leasing Public is expected to under-perform the TISCO Financial. In addition to that, Ratchthani Leasing is 4.82 times more volatile than TISCO Financial Group. It trades about -0.21 of its total potential returns per unit of risk. TISCO Financial Group is currently generating about 0.08 per unit of volatility. If you would invest  9,650  in TISCO Financial Group on September 28, 2024 and sell it today you would earn a total of  200.00  from holding TISCO Financial Group or generate 2.07% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Ratchthani Leasing Public  vs.  TISCO Financial Group

Ratchthani Leasing Public

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ratchthani Leasing Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental drivers remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

TISCO Financial Group

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in TISCO Financial Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, TISCO Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Ratchthani Leasing and TISCO Financial

The main advantage of trading using opposite Ratchthani Leasing and TISCO Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ratchthani Leasing position performs unexpectedly, TISCO Financial 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 TISCO Financial will offset losses from the drop in TISCO Financial's long position.

The idea behind Ratchthani Leasing Public and TISCO Financial Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.