Correlation Between SBI Insurance and CLEAN ENERGY
Can any of the company-specific risk be diversified away by investing in both SBI Insurance and CLEAN ENERGY 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 CLEAN ENERGY 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 CLEAN ENERGY FUELS, you can compare the effects of market volatilities on SBI Insurance and CLEAN ENERGY 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 CLEAN ENERGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBI Insurance and CLEAN ENERGY.
Diversification Opportunities for SBI Insurance and CLEAN ENERGY
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SBI and CLEAN is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding SBI Insurance Group and CLEAN ENERGY FUELS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CLEAN ENERGY FUELS 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 CLEAN ENERGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CLEAN ENERGY FUELS has no effect on the direction of SBI Insurance i.e., SBI Insurance and CLEAN ENERGY go up and down completely randomly.
Pair Corralation between SBI Insurance and CLEAN ENERGY
Assuming the 90 days trading horizon SBI Insurance Group is expected to generate 0.52 times more return on investment than CLEAN ENERGY. However, SBI Insurance Group is 1.91 times less risky than CLEAN ENERGY. It trades about 0.01 of its potential returns per unit of risk. CLEAN ENERGY FUELS is currently generating about -0.01 per unit of risk. If you would invest 655.00 in SBI Insurance Group on November 6, 2024 and sell it today you would earn a total of 20.00 from holding SBI Insurance Group or generate 3.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SBI Insurance Group vs. CLEAN ENERGY FUELS
Performance |
| Timeline |
| SBI Insurance Group |
| CLEAN ENERGY FUELS |
SBI Insurance and CLEAN ENERGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBI Insurance and CLEAN ENERGY
The main advantage of trading using opposite SBI Insurance and CLEAN ENERGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBI Insurance position performs unexpectedly, CLEAN ENERGY 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 CLEAN ENERGY will offset losses from the drop in CLEAN ENERGY's long position.| SBI Insurance vs. RYU Apparel | SBI Insurance vs. Aluminum of | SBI Insurance vs. Fortescue Metals Group | SBI Insurance vs. ADRIATIC METALS LS 013355 |
| CLEAN ENERGY vs. Marie Brizard Wine | CLEAN ENERGY vs. Xinhua Winshare Publishing | CLEAN ENERGY vs. DELTA AIR LINES | CLEAN ENERGY vs. Laureate Education |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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