Correlation Between Benchmark Electronics and SBI Insurance
Can any of the company-specific risk be diversified away by investing in both Benchmark Electronics and SBI Insurance 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 Benchmark Electronics and SBI Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Benchmark Electronics and SBI Insurance Group, you can compare the effects of market volatilities on Benchmark Electronics and SBI Insurance 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 Benchmark Electronics with a short position of SBI Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Benchmark Electronics and SBI Insurance.
Diversification Opportunities for Benchmark Electronics and SBI Insurance
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Benchmark and SBI is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Benchmark Electronics and SBI Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SBI Insurance Group and Benchmark Electronics 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 Benchmark Electronics are associated (or correlated) with SBI Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SBI Insurance Group has no effect on the direction of Benchmark Electronics i.e., Benchmark Electronics and SBI Insurance go up and down completely randomly.
Pair Corralation between Benchmark Electronics and SBI Insurance
Assuming the 90 days horizon Benchmark Electronics is expected to generate 1.68 times more return on investment than SBI Insurance. However, Benchmark Electronics is 1.68 times more volatile than SBI Insurance Group. It trades about 0.12 of its potential returns per unit of risk. SBI Insurance Group is currently generating about 0.04 per unit of risk. If you would invest 3,784 in Benchmark Electronics on September 3, 2024 and sell it today you would earn a total of 716.00 from holding Benchmark Electronics or generate 18.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Benchmark Electronics vs. SBI Insurance Group
Performance |
| Timeline |
| Benchmark Electronics |
| SBI Insurance Group |
Benchmark Electronics and SBI Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Benchmark Electronics and SBI Insurance
The main advantage of trading using opposite Benchmark Electronics and SBI Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Benchmark Electronics position performs unexpectedly, SBI Insurance 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 SBI Insurance will offset losses from the drop in SBI Insurance's long position.| Benchmark Electronics vs. GALENA MINING LTD | Benchmark Electronics vs. ATOSS SOFTWARE | Benchmark Electronics vs. Unity Software | Benchmark Electronics vs. Alfa Financial Software |
| SBI Insurance vs. Richardson Electronics | SBI Insurance vs. Methode Electronics | SBI Insurance vs. HOCHSCHILD MINING | SBI Insurance vs. Benchmark Electronics |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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