Correlation Between Aisha Steel and Karachi 100
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By analyzing existing cross correlation between Aisha Steel Mills and Karachi 100, you can compare the effects of market volatilities on Aisha Steel and Karachi 100 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 Aisha Steel with a short position of Karachi 100. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aisha Steel and Karachi 100.
Diversification Opportunities for Aisha Steel and Karachi 100
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aisha and Karachi is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Aisha Steel Mills and Karachi 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Karachi 100 and Aisha Steel 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 Aisha Steel Mills are associated (or correlated) with Karachi 100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Karachi 100 has no effect on the direction of Aisha Steel i.e., Aisha Steel and Karachi 100 go up and down completely randomly.
Pair Corralation between Aisha Steel and Karachi 100
Assuming the 90 days trading horizon Aisha Steel is expected to generate 3.68 times less return on investment than Karachi 100. In addition to that, Aisha Steel is 2.78 times more volatile than Karachi 100. It trades about 0.02 of its total potential returns per unit of risk. Karachi 100 is currently generating about 0.24 per unit of volatility. If you would invest 7,466,666 in Karachi 100 on September 2, 2024 and sell it today you would earn a total of 2,669,034 from holding Karachi 100 or generate 35.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.19% |
| Values | Daily Returns |
Aisha Steel Mills vs. Karachi 100
Performance |
| Timeline |
Aisha Steel and Karachi 100 Volatility Contrast
Predicted Return Density |
| Returns |
Aisha Steel Mills
Pair trading matchups for Aisha Steel
Karachi 100
Pair trading matchups for Karachi 100
Pair Trading with Aisha Steel and Karachi 100
The main advantage of trading using opposite Aisha Steel and Karachi 100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aisha Steel position performs unexpectedly, Karachi 100 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 Karachi 100 will offset losses from the drop in Karachi 100's long position.| Aisha Steel vs. Askari General Insurance | Aisha Steel vs. Habib Insurance | Aisha Steel vs. Pakistan Aluminium Beverage | Aisha Steel vs. Air Link Communication |
| Karachi 100 vs. JS Investments | Karachi 100 vs. East West Insurance | Karachi 100 vs. Premier Insurance | Karachi 100 vs. Wah Nobel Chemicals |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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