Correlation Between Habib Insurance and Altern Energy

Can any of the company-specific risk be diversified away by investing in both Habib Insurance and Altern Energy 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 Habib Insurance and Altern Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Habib Insurance and Altern Energy

0.0

Correlation Coefficient

Habib Insurance  Altern Energy

Pay attention - limited upside

The 3 months correlation between Habib and Altern is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Habib Insurance and Altern Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altern Energy and Habib 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 Habib Insurance are associated (or correlated) with Altern Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altern Energy has no effect on the direction of Habib Insurance i.e., Habib Insurance and Altern Energy go up and down completely randomly.

Pair Corralation between Habib Insurance and Altern Energy

If you would invest  797.00  in Habib Insurance on October 25, 2024 and sell it today you would earn a total of  116.00  from holding Habib Insurance or generate 14.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.0%
Values	Daily Returns

Habib Insurance  vs.  Altern Energy

Habib Insurance

Risk-Adjusted Performance

10 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Habib Insurance are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Habib Insurance sustained solid returns over the last few months and may actually be approaching a breakup point.

Altern Energy

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days Altern Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Altern Energy is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Habib Insurance and Altern Energy

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

The idea behind Habib Insurance and Altern Energy 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.

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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.