Correlation Between Habib Insurance and Nimir Industrial
Can any of the company-specific risk be diversified away by investing in both Habib Insurance and Nimir Industrial 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 Nimir Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Habib Insurance and Nimir Industrial Chemical, you can compare the effects of market volatilities on Habib Insurance and Nimir Industrial 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 Nimir Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Habib Insurance and Nimir Industrial.
Diversification Opportunities for Habib Insurance and Nimir Industrial
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Habib and Nimir is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Habib Insurance and Nimir Industrial Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nimir Industrial Chemical 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 Nimir Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nimir Industrial Chemical has no effect on the direction of Habib Insurance i.e., Habib Insurance and Nimir Industrial go up and down completely randomly.
Pair Corralation between Habib Insurance and Nimir Industrial
Assuming the 90 days trading horizon Habib Insurance is expected to generate 1.61 times more return on investment than Nimir Industrial. However, Habib Insurance is 1.61 times more volatile than Nimir Industrial Chemical. It trades about 0.07 of its potential returns per unit of risk. Nimir Industrial Chemical is currently generating about 0.1 per unit of risk. If you would invest 586.00 in Habib Insurance on December 4, 2024 and sell it today you would earn a total of 334.00 from holding Habib Insurance or generate 57.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 91.74% |
Values | Daily Returns |
Habib Insurance vs. Nimir Industrial Chemical
Performance |
Timeline |
Habib Insurance |
Nimir Industrial Chemical |
Habib Insurance and Nimir Industrial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Habib Insurance and Nimir Industrial
The main advantage of trading using opposite Habib Insurance and Nimir Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Habib Insurance position performs unexpectedly, Nimir Industrial 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 Nimir Industrial will offset losses from the drop in Nimir Industrial's long position.Habib Insurance vs. Pakistan Aluminium Beverage | Habib Insurance vs. Air Link Communication | Habib Insurance vs. The Organic Meat | Habib Insurance vs. National Foods |
Nimir Industrial vs. Pakistan Reinsurance | Nimir Industrial vs. Jubilee Life Insurance | Nimir Industrial vs. Engro Polymer Chemicals | Nimir Industrial vs. Askari General Insurance |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |