Correlation Between Chia and Peoples Insurance

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

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

Diversification Opportunities for Chia and Peoples Insurance

-0.64

Correlation Coefficient

Chia  Peoples Insurance

Excellent diversification

The 3 months correlation between Chia and Peoples is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Chia and The Peoples Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peoples Insurance and Chia 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 Chia are associated (or correlated) with Peoples Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peoples Insurance has no effect on the direction of Chia i.e., Chia and Peoples Insurance go up and down completely randomly.

Pair Corralation between Chia and Peoples Insurance

Assuming the 90 days trading horizon Chia is expected to under-perform the Peoples Insurance. In addition to that, Chia is 1.1 times more volatile than The Peoples Insurance. It trades about -0.12 of its total potential returns per unit of risk. The Peoples Insurance is currently generating about 0.11 per unit of volatility. If you would invest  39.00  in The Peoples Insurance on December 21, 2024 and sell it today you would earn a total of  13.00  from holding The Peoples Insurance or generate 33.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	93.65%
Values	Daily Returns

Chia  vs.  The Peoples Insurance

Chia

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chia has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's technical indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for Chia shareholders.

Peoples Insurance

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in The Peoples Insurance are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Peoples Insurance reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Chia and Peoples Insurance

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

The idea behind Chia and The Peoples Insurance 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.

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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .