Correlation Between CHESNARA PLC and PING AN
Can any of the company-specific risk be diversified away by investing in both CHESNARA PLC and PING AN 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 CHESNARA PLC and PING AN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CHESNARA PLC LS 05 and PING AN INSURANCH, you can compare the effects of market volatilities on CHESNARA PLC and PING AN 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 CHESNARA PLC with a short position of PING AN. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHESNARA PLC and PING AN.
Diversification Opportunities for CHESNARA PLC and PING AN
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between CHESNARA and PING is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding CHESNARA PLC LS 05 and PING AN INSURANCH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PING AN INSURANCH and CHESNARA PLC 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 CHESNARA PLC LS 05 are associated (or correlated) with PING AN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PING AN INSURANCH has no effect on the direction of CHESNARA PLC i.e., CHESNARA PLC and PING AN go up and down completely randomly.
Pair Corralation between CHESNARA PLC and PING AN
Assuming the 90 days horizon CHESNARA PLC LS 05 is expected to generate 1.19 times more return on investment than PING AN. However, CHESNARA PLC is 1.19 times more volatile than PING AN INSURANCH. It trades about 0.03 of its potential returns per unit of risk. PING AN INSURANCH is currently generating about -0.29 per unit of risk. If you would invest 314.00 in CHESNARA PLC LS 05 on October 25, 2024 and sell it today you would earn a total of 2.00 from holding CHESNARA PLC LS 05 or generate 0.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
CHESNARA PLC LS 05 vs. PING AN INSURANCH
Performance |
| Timeline |
| CHESNARA PLC LS |
| PING AN INSURANCH |
CHESNARA PLC and PING AN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CHESNARA PLC and PING AN
The main advantage of trading using opposite CHESNARA PLC and PING AN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHESNARA PLC position performs unexpectedly, PING AN 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 PING AN will offset losses from the drop in PING AN's long position.| CHESNARA PLC vs. Aluminum of | CHESNARA PLC vs. Wizz Air Holdings | CHESNARA PLC vs. Yuexiu Transport Infrastructure | CHESNARA PLC vs. ADRIATIC METALS LS 013355 |
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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