Correlation Between CIC INSURANCE and CO OPERATIVE
Can any of the company-specific risk be diversified away by investing in both CIC INSURANCE and CO OPERATIVE 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 CIC INSURANCE and CO OPERATIVE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CIC INSURANCE GROUP and CO OPERATIVE BANK OF, you can compare the effects of market volatilities on CIC INSURANCE and CO OPERATIVE 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 CIC INSURANCE with a short position of CO OPERATIVE. Check out your portfolio center. Please also check ongoing floating volatility patterns of CIC INSURANCE and CO OPERATIVE.
Diversification Opportunities for CIC INSURANCE and CO OPERATIVE
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CIC and CBKL is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding CIC INSURANCE GROUP and CO OPERATIVE BANK OF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CO OPERATIVE BANK and CIC 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 CIC INSURANCE GROUP are associated (or correlated) with CO OPERATIVE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CO OPERATIVE BANK has no effect on the direction of CIC INSURANCE i.e., CIC INSURANCE and CO OPERATIVE go up and down completely randomly.
Pair Corralation between CIC INSURANCE and CO OPERATIVE
Assuming the 90 days trading horizon CIC INSURANCE GROUP is expected to under-perform the CO OPERATIVE. In addition to that, CIC INSURANCE is 2.89 times more volatile than CO OPERATIVE BANK OF. It trades about -0.16 of its total potential returns per unit of risk. CO OPERATIVE BANK OF is currently generating about 0.11 per unit of volatility. If you would invest 1,375 in CO OPERATIVE BANK OF on August 24, 2024 and sell it today you would earn a total of 25.00 from holding CO OPERATIVE BANK OF or generate 1.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CIC INSURANCE GROUP vs. CO OPERATIVE BANK OF
Performance |
| Timeline |
| CIC INSURANCE GROUP |
| CO OPERATIVE BANK |
CIC INSURANCE and CO OPERATIVE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CIC INSURANCE and CO OPERATIVE
The main advantage of trading using opposite CIC INSURANCE and CO OPERATIVE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CIC INSURANCE position performs unexpectedly, CO OPERATIVE 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 CO OPERATIVE will offset losses from the drop in CO OPERATIVE's long position.| CIC INSURANCE vs. SAFARICOM PLC | CIC INSURANCE vs. ABSA BANK OF | CIC INSURANCE vs. BRITISH AMERICAN TOBACCO | CIC INSURANCE vs. CO OPERATIVE BANK OF |
| CO OPERATIVE vs. ABSA BANK OF | CO OPERATIVE vs. CIC INSURANCE GROUP | CO OPERATIVE vs. BRITISH AMERICAN TOBACCO | CO OPERATIVE vs. UCHUMI SUPERMARKET PLC |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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