Correlation Between Peoples Insurance and Ligao Foods
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By analyzing existing cross correlation between Peoples Insurance of and Ligao Foods CoLtd, you can compare the effects of market volatilities on Peoples Insurance and Ligao Foods 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 Ligao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peoples Insurance and Ligao Foods.
Diversification Opportunities for Peoples Insurance and Ligao Foods
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Peoples and Ligao is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Peoples Insurance of and Ligao Foods CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ligao Foods CoLtd 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 Ligao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ligao Foods CoLtd has no effect on the direction of Peoples Insurance i.e., Peoples Insurance and Ligao Foods go up and down completely randomly.
Pair Corralation between Peoples Insurance and Ligao Foods
Assuming the 90 days trading horizon Peoples Insurance of is expected to generate 0.78 times more return on investment than Ligao Foods. However, Peoples Insurance of is 1.29 times less risky than Ligao Foods. It trades about -0.03 of its potential returns per unit of risk. Ligao Foods CoLtd is currently generating about -0.05 per unit of risk. If you would invest 726.00 in Peoples Insurance of on August 28, 2024 and sell it today you would lose (15.00) from holding Peoples Insurance of or give up 2.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peoples Insurance of vs. Ligao Foods CoLtd
Performance |
| Timeline |
| Peoples Insurance |
| Ligao Foods CoLtd |
Peoples Insurance and Ligao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peoples Insurance and Ligao Foods
The main advantage of trading using opposite Peoples Insurance and Ligao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peoples Insurance position performs unexpectedly, Ligao Foods 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 Ligao Foods will offset losses from the drop in Ligao Foods' long position.| Peoples Insurance vs. PetroChina Co Ltd | Peoples Insurance vs. China Mobile Limited | Peoples Insurance vs. CNOOC Limited | Peoples Insurance vs. Ping An Insurance |
| Ligao Foods vs. China Petroleum Chemical | Ligao Foods vs. PetroChina Co Ltd | Ligao Foods vs. China State Construction | Ligao Foods vs. China Railway Group |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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