Correlation Between Libra Insurance and Teuza A
Can any of the company-specific risk be diversified away by investing in both Libra Insurance and Teuza A 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 Libra Insurance and Teuza A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Libra Insurance and Teuza A Fairchild, you can compare the effects of market volatilities on Libra Insurance and Teuza A 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 Libra Insurance with a short position of Teuza A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Libra Insurance and Teuza A.
Diversification Opportunities for Libra Insurance and Teuza A
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Libra and Teuza is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Libra Insurance and Teuza A Fairchild in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Teuza A Fairchild and Libra 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 Libra Insurance are associated (or correlated) with Teuza A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Teuza A Fairchild has no effect on the direction of Libra Insurance i.e., Libra Insurance and Teuza A go up and down completely randomly.
Pair Corralation between Libra Insurance and Teuza A
Assuming the 90 days trading horizon Libra Insurance is expected to generate 1.61 times more return on investment than Teuza A. However, Libra Insurance is 1.61 times more volatile than Teuza A Fairchild. It trades about 0.18 of its potential returns per unit of risk. Teuza A Fairchild is currently generating about 0.11 per unit of risk. If you would invest 105,900 in Libra Insurance on December 29, 2024 and sell it today you would earn a total of 32,200 from holding Libra Insurance or generate 30.41% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Libra Insurance vs. Teuza A Fairchild
Performance |
Timeline |
Libra Insurance |
Teuza A Fairchild |
Libra Insurance and Teuza A Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Libra Insurance and Teuza A
The main advantage of trading using opposite Libra Insurance and Teuza A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Libra Insurance position performs unexpectedly, Teuza A 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 Teuza A will offset losses from the drop in Teuza A's long position.Libra Insurance vs. Computer Direct | Libra Insurance vs. Clal Biotechnology Industries | Libra Insurance vs. WhiteSmoke Software | Libra Insurance vs. Bezeq Israeli Telecommunication |
Teuza A vs. Mivtach Shamir | Teuza A vs. Migdal Insurance | Teuza A vs. Clal Insurance Enterprises | Teuza A vs. Analyst IMS 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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