Correlation Between East West and Shaheen Insurance
Can any of the company-specific risk be diversified away by investing in both East West and Shaheen Insurance 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 East West and Shaheen Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between East West Insurance and Shaheen Insurance, you can compare the effects of market volatilities on East West and Shaheen Insurance 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 East West with a short position of Shaheen Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of East West and Shaheen Insurance.
Diversification Opportunities for East West and Shaheen Insurance
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between East and Shaheen is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding East West Insurance and Shaheen Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shaheen Insurance and East West 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 East West Insurance are associated (or correlated) with Shaheen Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shaheen Insurance has no effect on the direction of East West i.e., East West and Shaheen Insurance go up and down completely randomly.
Pair Corralation between East West and Shaheen Insurance
If you would invest 655.00 in Shaheen Insurance on December 4, 2024 and sell it today you would earn a total of 26.00 from holding Shaheen Insurance or generate 3.97% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 10.0% |
Values | Daily Returns |
East West Insurance vs. Shaheen Insurance
Performance |
Timeline |
East West Insurance |
Risk-Adjusted Performance
Market Crasher
Weak | Strong |
Shaheen Insurance |
East West and Shaheen Insurance Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with East West and Shaheen Insurance
The main advantage of trading using opposite East West and Shaheen Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if East West position performs unexpectedly, Shaheen Insurance 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 Shaheen Insurance will offset losses from the drop in Shaheen Insurance's long position.East West vs. JS Investments | East West vs. Metropolitan Steel Corp | East West vs. International Steels | East West vs. Arpak International Investment |
Shaheen Insurance vs. Pakistan Telecommunication | Shaheen Insurance vs. JS Investments | Shaheen Insurance vs. Invest Capital Investment | Shaheen Insurance vs. Mughal Iron Steel |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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