Correlation Between LIFENET INSURANCE and Ping An
Can any of the company-specific risk be diversified away by investing in both LIFENET INSURANCE 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 LIFENET INSURANCE and Ping An into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between LIFENET INSURANCE CO and Ping An Insurance, you can compare the effects of market volatilities on LIFENET INSURANCE 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 LIFENET INSURANCE with a short position of Ping An. Check out your portfolio center. Please also check ongoing floating volatility patterns of LIFENET INSURANCE and Ping An.
Diversification Opportunities for LIFENET INSURANCE and Ping An
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between LIFENET and Ping is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding LIFENET INSURANCE CO and Ping An Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ping An Insurance and LIFENET 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 LIFENET INSURANCE CO 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 Insurance has no effect on the direction of LIFENET INSURANCE i.e., LIFENET INSURANCE and Ping An go up and down completely randomly.
Pair Corralation between LIFENET INSURANCE and Ping An
Assuming the 90 days horizon LIFENET INSURANCE is expected to generate 3.84 times less return on investment than Ping An. But when comparing it to its historical volatility, LIFENET INSURANCE CO is 2.03 times less risky than Ping An. It trades about 0.09 of its potential returns per unit of risk. Ping An Insurance is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 334.00 in Ping An Insurance on August 31, 2024 and sell it today you would earn a total of 206.00 from holding Ping An Insurance or generate 61.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
LIFENET INSURANCE CO vs. Ping An Insurance
Performance |
| Timeline |
| LIFENET INSURANCE |
| Ping An Insurance |
LIFENET INSURANCE and Ping An Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with LIFENET INSURANCE and Ping An
The main advantage of trading using opposite LIFENET INSURANCE and Ping An positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if LIFENET INSURANCE 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.| LIFENET INSURANCE vs. ONWARD MEDICAL BV | LIFENET INSURANCE vs. CHINA TONTINE WINES | LIFENET INSURANCE vs. ITALIAN WINE BRANDS | LIFENET INSURANCE vs. MELIA HOTELS |
| Ping An vs. Southwest Airlines Co | Ping An vs. Selective Insurance Group | Ping An vs. MOVIE GAMES SA | Ping An vs. Reinsurance Group 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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