Correlation Between SBI Insurance and Uber Technologies
Can any of the company-specific risk be diversified away by investing in both SBI Insurance and Uber Technologies 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 SBI Insurance and Uber Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SBI Insurance Group and Uber Technologies, you can compare the effects of market volatilities on SBI Insurance and Uber Technologies 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 SBI Insurance with a short position of Uber Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBI Insurance and Uber Technologies.
Diversification Opportunities for SBI Insurance and Uber Technologies
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SBI and Uber is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding SBI Insurance Group and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies and SBI 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 SBI Insurance Group are associated (or correlated) with Uber Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uber Technologies has no effect on the direction of SBI Insurance i.e., SBI Insurance and Uber Technologies go up and down completely randomly.
Pair Corralation between SBI Insurance and Uber Technologies
Assuming the 90 days trading horizon SBI Insurance Group is expected to generate 0.45 times more return on investment than Uber Technologies. However, SBI Insurance Group is 2.22 times less risky than Uber Technologies. It trades about 0.29 of its potential returns per unit of risk. Uber Technologies is currently generating about -0.05 per unit of risk. If you would invest 545.00 in SBI Insurance Group on August 29, 2024 and sell it today you would earn a total of 50.00 from holding SBI Insurance Group or generate 9.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SBI Insurance Group vs. Uber Technologies
Performance |
| Timeline |
| SBI Insurance Group |
| Uber Technologies |
SBI Insurance and Uber Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBI Insurance and Uber Technologies
The main advantage of trading using opposite SBI Insurance and Uber Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBI Insurance position performs unexpectedly, Uber Technologies 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 Uber Technologies will offset losses from the drop in Uber Technologies' long position.| SBI Insurance vs. MAGIC SOFTWARE ENTR | SBI Insurance vs. Alfa Financial Software | SBI Insurance vs. Cal Maine Foods | SBI Insurance vs. JJ SNACK FOODS |
| Uber Technologies vs. Apple Inc | Uber Technologies vs. Apple Inc | Uber Technologies vs. Apple Inc | Uber Technologies vs. Apple Inc |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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