Correlation Between Federal Bank and Life Insurance
Specify exactly 2 symbols:
By analyzing existing cross correlation between The Federal Bank and Life Insurance, you can compare the effects of market volatilities on Federal Bank 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 Federal Bank with a short position of Life Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federal Bank and Life Insurance.
Diversification Opportunities for Federal Bank and Life Insurance
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Federal and Life is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding The Federal Bank and Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life Insurance and Federal Bank 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 The Federal Bank 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 Federal Bank i.e., Federal Bank and Life Insurance go up and down completely randomly.
Pair Corralation between Federal Bank and Life Insurance
Assuming the 90 days trading horizon The Federal Bank is expected to under-perform the Life Insurance. But the stock apears to be less risky and, when comparing its historical volatility, The Federal Bank is 1.02 times less risky than Life Insurance. The stock trades about -0.19 of its potential returns per unit of risk. The Life Insurance is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 87,640 in Life Insurance on November 8, 2024 and sell it today you would lose (3,375) from holding Life Insurance or give up 3.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Federal Bank vs. Life Insurance
Performance |
| Timeline |
| Federal Bank |
| Life Insurance |
Federal Bank and Life Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federal Bank and Life Insurance
The main advantage of trading using opposite Federal Bank and Life Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federal Bank 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.| Federal Bank vs. Dodla Dairy Limited | Federal Bank vs. Arman Financial Services | Federal Bank vs. UCO Bank | Federal Bank vs. RBL Bank Limited |
| Life Insurance vs. Iris Clothings Limited | Life Insurance vs. Future Retail Limited | Life Insurance vs. Baazar Style Retail | Life Insurance vs. Silgo Retail Limited |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |