Correlation Between Aflac Incorporated and CIG PANNONIA
Can any of the company-specific risk be diversified away by investing in both Aflac Incorporated and CIG PANNONIA 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 Aflac Incorporated and CIG PANNONIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aflac Incorporated and CIG PANNONIA LIFE, you can compare the effects of market volatilities on Aflac Incorporated and CIG PANNONIA 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 Aflac Incorporated with a short position of CIG PANNONIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aflac Incorporated and CIG PANNONIA.
Diversification Opportunities for Aflac Incorporated and CIG PANNONIA
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Aflac and CIG is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Aflac Incorporated and CIG PANNONIA LIFE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIG PANNONIA LIFE and Aflac Incorporated 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 Aflac Incorporated are associated (or correlated) with CIG PANNONIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIG PANNONIA LIFE has no effect on the direction of Aflac Incorporated i.e., Aflac Incorporated and CIG PANNONIA go up and down completely randomly.
Pair Corralation between Aflac Incorporated and CIG PANNONIA
Assuming the 90 days horizon Aflac Incorporated is expected to generate 4.81 times less return on investment than CIG PANNONIA. But when comparing it to its historical volatility, Aflac Incorporated is 1.33 times less risky than CIG PANNONIA. It trades about 0.13 of its potential returns per unit of risk. CIG PANNONIA LIFE is currently generating about 0.48 of returns per unit of risk over similar time horizon. If you would invest 85.00 in CIG PANNONIA LIFE on October 25, 2024 and sell it today you would earn a total of 11.00 from holding CIG PANNONIA LIFE or generate 12.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
Aflac Incorporated vs. CIG PANNONIA LIFE
Performance |
| Timeline |
| Aflac Incorporated |
| CIG PANNONIA LIFE |
Aflac Incorporated and CIG PANNONIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aflac Incorporated and CIG PANNONIA
The main advantage of trading using opposite Aflac Incorporated and CIG PANNONIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aflac Incorporated position performs unexpectedly, CIG PANNONIA 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 CIG PANNONIA will offset losses from the drop in CIG PANNONIA's long position.| Aflac Incorporated vs. The Yokohama Rubber | Aflac Incorporated vs. Tower One Wireless | Aflac Incorporated vs. GOODYEAR T RUBBER | Aflac Incorporated vs. VULCAN MATERIALS |
| CIG PANNONIA vs. Diamyd Medical AB | CIG PANNONIA vs. Meli Hotels International | CIG PANNONIA vs. Park Hotels Resorts | CIG PANNONIA vs. Apollo Medical Holdings |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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