Correlation Between AIICO INSURANCE and STERLING FINANCIAL
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By analyzing existing cross correlation between AIICO INSURANCE PLC and STERLING FINANCIAL HOLDINGS, you can compare the effects of market volatilities on AIICO INSURANCE and STERLING FINANCIAL 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 AIICO INSURANCE with a short position of STERLING FINANCIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIICO INSURANCE and STERLING FINANCIAL.
Diversification Opportunities for AIICO INSURANCE and STERLING FINANCIAL
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between AIICO and STERLING is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding AIICO INSURANCE PLC and STERLING FINANCIAL HOLDINGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STERLING FINANCIAL and AIICO 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 AIICO INSURANCE PLC are associated (or correlated) with STERLING FINANCIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STERLING FINANCIAL has no effect on the direction of AIICO INSURANCE i.e., AIICO INSURANCE and STERLING FINANCIAL go up and down completely randomly.
Pair Corralation between AIICO INSURANCE and STERLING FINANCIAL
Assuming the 90 days trading horizon AIICO INSURANCE PLC is expected to generate 1.34 times more return on investment than STERLING FINANCIAL. However, AIICO INSURANCE is 1.34 times more volatile than STERLING FINANCIAL HOLDINGS. It trades about 0.11 of its potential returns per unit of risk. STERLING FINANCIAL HOLDINGS is currently generating about 0.09 per unit of risk. If you would invest 155.00 in AIICO INSURANCE PLC on January 30, 2025 and sell it today you would earn a total of 11.00 from holding AIICO INSURANCE PLC or generate 7.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AIICO INSURANCE PLC vs. STERLING FINANCIAL HOLDINGS
Performance |
| Timeline |
| AIICO INSURANCE PLC |
| STERLING FINANCIAL |
AIICO INSURANCE and STERLING FINANCIAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIICO INSURANCE and STERLING FINANCIAL
The main advantage of trading using opposite AIICO INSURANCE and STERLING FINANCIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIICO INSURANCE position performs unexpectedly, STERLING FINANCIAL 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 STERLING FINANCIAL will offset losses from the drop in STERLING FINANCIAL's long position.| AIICO INSURANCE vs. AFROMEDIA PLC | AIICO INSURANCE vs. CHAMPION BREWERIES PLC | AIICO INSURANCE vs. UNIVERSAL INSURANCE PANY | AIICO INSURANCE vs. MULTIVERSE MINING AND |
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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