Correlation Between Century Insurance and Karachi 100
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By analyzing existing cross correlation between Century Insurance and Karachi 100, you can compare the effects of market volatilities on Century Insurance and Karachi 100 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 Century Insurance with a short position of Karachi 100. Check out your portfolio center. Please also check ongoing floating volatility patterns of Century Insurance and Karachi 100.
Diversification Opportunities for Century Insurance and Karachi 100
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Century and Karachi is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Century Insurance and Karachi 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Karachi 100 and Century Insurance 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 Century Insurance are associated (or correlated) with Karachi 100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Karachi 100 has no effect on the direction of Century Insurance i.e., Century Insurance and Karachi 100 go up and down completely randomly.
Pair Corralation between Century Insurance and Karachi 100
Assuming the 90 days trading horizon Century Insurance is expected to generate 2.1 times more return on investment than Karachi 100. However, Century Insurance is 2.1 times more volatile than Karachi 100. It trades about 0.24 of its potential returns per unit of risk. Karachi 100 is currently generating about 0.48 per unit of risk. If you would invest 2,680 in Century Insurance on September 12, 2024 and sell it today you would earn a total of 1,069 from holding Century Insurance or generate 39.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 96.88% |
Values | Daily Returns |
Century Insurance vs. Karachi 100
Performance |
Timeline |
Century Insurance and Karachi 100 Volatility Contrast
Predicted Return Density |
Returns |
Century Insurance
Pair trading matchups for Century Insurance
Karachi 100
Pair trading matchups for Karachi 100
Pair Trading with Century Insurance and Karachi 100
The main advantage of trading using opposite Century Insurance and Karachi 100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Century Insurance position performs unexpectedly, Karachi 100 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 Karachi 100 will offset losses from the drop in Karachi 100's long position.Century Insurance vs. Masood Textile Mills | Century Insurance vs. Fauji Foods | Century Insurance vs. KSB Pumps | Century Insurance vs. Mari Petroleum |
Karachi 100 vs. Aisha Steel Mills | Karachi 100 vs. Shifa International Hospitals | Karachi 100 vs. Nimir Industrial Chemical | Karachi 100 vs. ORIX Leasing Pakistan |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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