Correlation Between ALLFUNDS GROUP and INSURANCE AUST
Can any of the company-specific risk be diversified away by investing in both ALLFUNDS GROUP and INSURANCE AUST 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 ALLFUNDS GROUP and INSURANCE AUST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALLFUNDS GROUP EO 0025 and INSURANCE AUST GRP, you can compare the effects of market volatilities on ALLFUNDS GROUP and INSURANCE AUST 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 ALLFUNDS GROUP with a short position of INSURANCE AUST. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALLFUNDS GROUP and INSURANCE AUST.
Diversification Opportunities for ALLFUNDS GROUP and INSURANCE AUST
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ALLFUNDS and INSURANCE is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding ALLFUNDS GROUP EO 0025 and INSURANCE AUST GRP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INSURANCE AUST GRP and ALLFUNDS GROUP 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 ALLFUNDS GROUP EO 0025 are associated (or correlated) with INSURANCE AUST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INSURANCE AUST GRP has no effect on the direction of ALLFUNDS GROUP i.e., ALLFUNDS GROUP and INSURANCE AUST go up and down completely randomly.
Pair Corralation between ALLFUNDS GROUP and INSURANCE AUST
Assuming the 90 days horizon ALLFUNDS GROUP EO 0025 is expected to under-perform the INSURANCE AUST. In addition to that, ALLFUNDS GROUP is 1.1 times more volatile than INSURANCE AUST GRP. It trades about -0.12 of its total potential returns per unit of risk. INSURANCE AUST GRP is currently generating about 0.18 per unit of volatility. If you would invest 448.00 in INSURANCE AUST GRP on October 25, 2024 and sell it today you would earn a total of 77.00 from holding INSURANCE AUST GRP or generate 17.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ALLFUNDS GROUP EO 0025 vs. INSURANCE AUST GRP
Performance |
| Timeline |
| ALLFUNDS GROUP EO |
| INSURANCE AUST GRP |
ALLFUNDS GROUP and INSURANCE AUST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALLFUNDS GROUP and INSURANCE AUST
The main advantage of trading using opposite ALLFUNDS GROUP and INSURANCE AUST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALLFUNDS GROUP position performs unexpectedly, INSURANCE AUST 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 INSURANCE AUST will offset losses from the drop in INSURANCE AUST's long position.| ALLFUNDS GROUP vs. PennantPark Investment | ALLFUNDS GROUP vs. PennyMac Mortgage Investment | ALLFUNDS GROUP vs. KENEDIX OFFICE INV | ALLFUNDS GROUP vs. MGIC INVESTMENT |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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