Correlation Between Fortis Healthcare and General Insurance
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By analyzing existing cross correlation between Fortis Healthcare Limited and General Insurance, you can compare the effects of market volatilities on Fortis Healthcare and General 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 Fortis Healthcare with a short position of General Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortis Healthcare and General Insurance.
Diversification Opportunities for Fortis Healthcare and General Insurance
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Fortis and General is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Fortis Healthcare Limited and General Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Insurance and Fortis Healthcare 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 Fortis Healthcare Limited are associated (or correlated) with General Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Insurance has no effect on the direction of Fortis Healthcare i.e., Fortis Healthcare and General Insurance go up and down completely randomly.
Pair Corralation between Fortis Healthcare and General Insurance
Assuming the 90 days trading horizon Fortis Healthcare Limited is expected to under-perform the General Insurance. But the stock apears to be less risky and, when comparing its historical volatility, Fortis Healthcare Limited is 1.71 times less risky than General Insurance. The stock trades about -0.11 of its potential returns per unit of risk. The General Insurance is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 39,960 in General Insurance on October 30, 2024 and sell it today you would lose (60.00) from holding General Insurance or give up 0.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fortis Healthcare Limited vs. General Insurance
Performance |
| Timeline |
| Fortis Healthcare |
| General Insurance |
Fortis Healthcare and General Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortis Healthcare and General Insurance
The main advantage of trading using opposite Fortis Healthcare and General Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortis Healthcare position performs unexpectedly, General 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 General Insurance will offset losses from the drop in General Insurance's long position.| Fortis Healthcare vs. Tamilnadu Telecommunication Limited | Fortis Healthcare vs. Kavveri Telecom Products | Fortis Healthcare vs. Heritage Foods Limited | Fortis Healthcare vs. Patanjali Foods Limited |
| General Insurance vs. Sportking India Limited | General Insurance vs. Silver Touch Technologies | General Insurance vs. Bikaji Foods International | General Insurance vs. HDFC Asset Management |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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