Correlation Between Softlogic Life and Union Bank
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By analyzing existing cross correlation between Softlogic Life Insurance and Union Bank, you can compare the effects of market volatilities on Softlogic Life and Union Bank 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 Softlogic Life with a short position of Union Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Softlogic Life and Union Bank.
Diversification Opportunities for Softlogic Life and Union Bank
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Softlogic and Union is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Softlogic Life Insurance and Union Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union Bank and Softlogic Life 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 Softlogic Life Insurance are associated (or correlated) with Union Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union Bank has no effect on the direction of Softlogic Life i.e., Softlogic Life and Union Bank go up and down completely randomly.
Pair Corralation between Softlogic Life and Union Bank
Assuming the 90 days trading horizon Softlogic Life Insurance is expected to generate 1.67 times more return on investment than Union Bank. However, Softlogic Life is 1.67 times more volatile than Union Bank. It trades about 0.13 of its potential returns per unit of risk. Union Bank is currently generating about -0.19 per unit of risk. If you would invest 5,950 in Softlogic Life Insurance on August 31, 2024 and sell it today you would earn a total of 260.00 from holding Softlogic Life Insurance or generate 4.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Softlogic Life Insurance vs. Union Bank
Performance |
| Timeline |
| Softlogic Life Insurance |
| Union Bank |
Softlogic Life and Union Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Softlogic Life and Union Bank
The main advantage of trading using opposite Softlogic Life and Union Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Softlogic Life position performs unexpectedly, Union Bank 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 Union Bank will offset losses from the drop in Union Bank's long position.| Softlogic Life vs. Renuka Agri Foods | Softlogic Life vs. Ceylon Tobacco | Softlogic Life vs. BROWNS INVESTMENTS PLC | Softlogic Life vs. Lanka Milk Foods |
| Union Bank vs. CEYLINCO INSURANCE PLC | Union Bank vs. Carson Cumberbatch PLC | Union Bank vs. Arpico Insurance | Union Bank vs. Pan Asia Banking |
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 Stocks Directory module to find actively traded stocks across global markets.
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