Correlation Between Centum Electronics and Life Insurance
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By analyzing existing cross correlation between Centum Electronics Limited and Life Insurance, you can compare the effects of market volatilities on Centum Electronics and Life 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 Centum Electronics with a short position of Life Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centum Electronics and Life Insurance.
Diversification Opportunities for Centum Electronics and Life Insurance
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Centum and Life is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Centum Electronics Limited and Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life Insurance and Centum 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 Centum Electronics Limited are associated (or correlated) with Life Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Life Insurance has no effect on the direction of Centum Electronics i.e., Centum Electronics and Life Insurance go up and down completely randomly.
Pair Corralation between Centum Electronics and Life Insurance
Assuming the 90 days trading horizon Centum Electronics Limited is expected to generate 1.65 times more return on investment than Life Insurance. However, Centum Electronics is 1.65 times more volatile than Life Insurance. It trades about 0.07 of its potential returns per unit of risk. Life Insurance is currently generating about 0.03 per unit of risk. If you would invest 71,997 in Centum Electronics Limited on August 26, 2024 and sell it today you would earn a total of 90,063 from holding Centum Electronics Limited or generate 125.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.57% |
| Values | Daily Returns |
Centum Electronics Limited vs. Life Insurance
Performance |
| Timeline |
| Centum Electronics |
| Life Insurance |
Centum Electronics and Life Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centum Electronics and Life Insurance
The main advantage of trading using opposite Centum Electronics and Life Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centum Electronics position performs unexpectedly, Life 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 Life Insurance will offset losses from the drop in Life Insurance's long position.| Centum Electronics vs. Life Insurance | Centum Electronics vs. Power Finance | Centum Electronics vs. HDFC Bank Limited | Centum Electronics vs. State Bank of |
| Life Insurance vs. Gangotri Textiles Limited | Life Insurance vs. Hemisphere Properties India | Life Insurance vs. Kingfa Science Technology | Life Insurance vs. Rico Auto Industries |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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