Correlation Between Peoples Insurance and Lier Chemical
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By analyzing existing cross correlation between Peoples Insurance of and Lier Chemical Co, you can compare the effects of market volatilities on Peoples Insurance and Lier Chemical 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 Peoples Insurance with a short position of Lier Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peoples Insurance and Lier Chemical.
Diversification Opportunities for Peoples Insurance and Lier Chemical
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Peoples and Lier is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Peoples Insurance of and Lier Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lier Chemical and Peoples 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 Peoples Insurance of are associated (or correlated) with Lier Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lier Chemical has no effect on the direction of Peoples Insurance i.e., Peoples Insurance and Lier Chemical go up and down completely randomly.
Pair Corralation between Peoples Insurance and Lier Chemical
Assuming the 90 days trading horizon Peoples Insurance is expected to generate 2.53 times less return on investment than Lier Chemical. In addition to that, Peoples Insurance is 1.34 times more volatile than Lier Chemical Co. It trades about 0.03 of its total potential returns per unit of risk. Lier Chemical Co is currently generating about 0.1 per unit of volatility. If you would invest 821.00 in Lier Chemical Co on September 2, 2024 and sell it today you would earn a total of 30.00 from holding Lier Chemical Co or generate 3.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peoples Insurance of vs. Lier Chemical Co
Performance |
| Timeline |
| Peoples Insurance |
| Lier Chemical |
Peoples Insurance and Lier Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peoples Insurance and Lier Chemical
The main advantage of trading using opposite Peoples Insurance and Lier Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peoples Insurance position performs unexpectedly, Lier Chemical 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 Lier Chemical will offset losses from the drop in Lier Chemical's long position.| Peoples Insurance vs. Shandong Mining Machinery | Peoples Insurance vs. Shenzhen Shenbao Industrial | Peoples Insurance vs. Lonkey Industrial Co | Peoples Insurance vs. Dhc Software Co |
| Lier Chemical vs. Peoples Insurance of | Lier Chemical vs. Shandong Hongchuang Aluminum | Lier Chemical vs. Qilu Bank Co | Lier Chemical vs. Aluminum Corp of |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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