Correlation Between Flutter Entertainment and TBC Bank

Can any of the company-specific risk be diversified away by investing in both Flutter Entertainment and TBC Bank 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 Flutter Entertainment and TBC Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Flutter Entertainment PLC and TBC Bank Group, you can compare the effects of market volatilities on Flutter Entertainment and TBC Bank 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 Flutter Entertainment with a short position of TBC Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flutter Entertainment and TBC Bank.

Diversification Opportunities for Flutter Entertainment and TBC Bank

0.8

Correlation Coefficient

Flutter Entertainment  TBC Bank

Very poor diversification

The 3 months correlation between Flutter and TBC is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Flutter Entertainment PLC and TBC Bank Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TBC Bank Group and Flutter Entertainment 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 Flutter Entertainment PLC are associated (or correlated) with TBC Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TBC Bank Group has no effect on the direction of Flutter Entertainment i.e., Flutter Entertainment and TBC Bank go up and down completely randomly.

Pair Corralation between Flutter Entertainment and TBC Bank

Assuming the 90 days trading horizon Flutter Entertainment PLC is expected to generate 0.83 times more return on investment than TBC Bank. However, Flutter Entertainment PLC is 1.21 times less risky than TBC Bank. It trades about 0.29 of its potential returns per unit of risk. TBC Bank Group is currently generating about 0.13 per unit of risk. If you would invest  1,683,500  in Flutter Entertainment PLC on April 22, 2025 and sell it today you would earn a total of  598,500  from holding Flutter Entertainment PLC or generate 35.55% return on investment over 90 days.

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

Flutter Entertainment PLC  vs.  TBC Bank Group

Flutter Entertainment PLC

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Flutter Entertainment PLC are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Flutter Entertainment unveiled solid returns over the last few months and may actually be approaching a breakup point.

TBC Bank Group

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in TBC Bank Group are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, TBC Bank unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Flutter Entertainment and TBC Bank

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

The idea behind Flutter Entertainment PLC and TBC Bank 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.