Correlation Between Habib Insurance and Media Times
Can any of the company-specific risk be diversified away by investing in both Habib Insurance and Media Times 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 Media Times into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Habib Insurance and Media Times, you can compare the effects of market volatilities on Habib Insurance and Media Times 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 Media Times. Check out your portfolio center. Please also check ongoing floating volatility patterns of Habib Insurance and Media Times.
Diversification Opportunities for Habib Insurance and Media Times
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Habib and Media is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Habib Insurance and Media Times in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media Times 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 Media Times. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media Times has no effect on the direction of Habib Insurance i.e., Habib Insurance and Media Times go up and down completely randomly.
Pair Corralation between Habib Insurance and Media Times
Assuming the 90 days trading horizon Habib Insurance is expected to generate 1.4 times more return on investment than Media Times. However, Habib Insurance is 1.4 times more volatile than Media Times. It trades about 0.07 of its potential returns per unit of risk. Media Times is currently generating about -0.13 per unit of risk. If you would invest 841.00 in Habib Insurance on December 30, 2024 and sell it today you would earn a total of 86.00 from holding Habib Insurance or generate 10.23% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Habib Insurance vs. Media Times
Performance |
Timeline |
Habib Insurance |
Media Times |
Habib Insurance and Media Times Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Habib Insurance and Media Times
The main advantage of trading using opposite Habib Insurance and Media Times positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Habib Insurance position performs unexpectedly, Media Times 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 Media Times will offset losses from the drop in Media Times' long position.Habib Insurance vs. Askari General Insurance | Habib Insurance vs. Media Times | Habib Insurance vs. MCB Investment Manag | Habib Insurance vs. Premier Insurance |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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