Correlation Between TC Bancshares and Southern States

Can any of the company-specific risk be diversified away by investing in both TC Bancshares and Southern States 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 TC Bancshares and Southern States into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between TC Bancshares and Southern States Bancshares, you can compare the effects of market volatilities on TC Bancshares and Southern States 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 TC Bancshares with a short position of Southern States. Check out your portfolio center. Please also check ongoing floating volatility patterns of TC Bancshares and Southern States.

Diversification Opportunities for TC Bancshares and Southern States

0.21

Correlation Coefficient

TC Bancshares  Southern States

Modest diversification

The 3 months correlation between TCBC and Southern is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding TC Bancshares and Southern States Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southern States Banc and TC Bancshares 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 TC Bancshares are associated (or correlated) with Southern States. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southern States Banc has no effect on the direction of TC Bancshares i.e., TC Bancshares and Southern States go up and down completely randomly.

Pair Corralation between TC Bancshares and Southern States

If you would invest  1,642  in TC Bancshares on July 19, 2025 and sell it today you would earn a total of  358.00  from holding TC Bancshares or generate 21.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.56%
Values	Daily Returns

TC Bancshares  vs.  Southern States Bancshares

TC Bancshares

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in TC Bancshares are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental drivers, TC Bancshares exhibited solid returns over the last few months and may actually be approaching a breakup point.

Southern States Banc

Risk-Adjusted Performance

Weakest

Over the last 90 days Southern States Bancshares has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent fundamental drivers, Southern States is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with TC Bancshares and Southern States

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

The idea behind TC Bancshares and Southern States Bancshares 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.