Correlation Between Habib Insurance and United Insurance
Can any of the company-specific risk be diversified away by investing in both Habib Insurance and United 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 Habib Insurance and United Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Habib Insurance and United Insurance, you can compare the effects of market volatilities on Habib Insurance and United 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 Habib Insurance with a short position of United Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Habib Insurance and United Insurance.
Diversification Opportunities for Habib Insurance and United Insurance
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Habib and United is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Habib Insurance and United Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Insurance 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 United Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Insurance has no effect on the direction of Habib Insurance i.e., Habib Insurance and United Insurance go up and down completely randomly.
Pair Corralation between Habib Insurance and United Insurance
Assuming the 90 days trading horizon Habib Insurance is expected to generate 1.83 times more return on investment than United Insurance. However, Habib Insurance is 1.83 times more volatile than United Insurance. It trades about 0.07 of its potential returns per unit of risk. United Insurance is currently generating about 0.11 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 | 87.92% |
Values | Daily Returns |
Habib Insurance vs. United Insurance
Performance |
Timeline |
Habib Insurance |
United Insurance |
Habib Insurance and United Insurance Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Habib Insurance and United Insurance
The main advantage of trading using opposite Habib Insurance and United Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Habib Insurance position performs unexpectedly, United 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 United Insurance will offset losses from the drop in United Insurance'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 |
United Insurance vs. NetSol Technologies | United Insurance vs. Habib Insurance | United Insurance vs. Silkbank | United Insurance vs. Avanceon |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |