Correlation Between Fateh Sports and Century Insurance
Can any of the company-specific risk be diversified away by investing in both Fateh Sports and Century Insurance 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 Fateh Sports and Century Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fateh Sports Wear and Century Insurance, you can compare the effects of market volatilities on Fateh Sports and Century 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 Fateh Sports with a short position of Century Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fateh Sports and Century Insurance.
Diversification Opportunities for Fateh Sports and Century Insurance
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fateh and Century is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Fateh Sports Wear and Century Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Century Insurance and Fateh Sports 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 Fateh Sports Wear are associated (or correlated) with Century Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Century Insurance has no effect on the direction of Fateh Sports i.e., Fateh Sports and Century Insurance go up and down completely randomly.
Pair Corralation between Fateh Sports and Century Insurance
Assuming the 90 days trading horizon Fateh Sports Wear is expected to generate 1.49 times more return on investment than Century Insurance. However, Fateh Sports is 1.49 times more volatile than Century Insurance. It trades about 0.12 of its potential returns per unit of risk. Century Insurance is currently generating about 0.12 per unit of risk. If you would invest 6,248 in Fateh Sports Wear on November 5, 2024 and sell it today you would earn a total of 3,252 from holding Fateh Sports Wear or generate 52.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 24.48% |
| Values | Daily Returns |
Fateh Sports Wear vs. Century Insurance
Performance |
| Timeline |
| Fateh Sports Wear |
| Century Insurance |
Fateh Sports and Century Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fateh Sports and Century Insurance
The main advantage of trading using opposite Fateh Sports and Century Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fateh Sports position performs unexpectedly, Century 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 Century Insurance will offset losses from the drop in Century Insurance's long position.| Fateh Sports vs. Hi Tech Lubricants | Fateh Sports vs. Synthetic Products Enterprises | Fateh Sports vs. Big Bird Foods | Fateh Sports vs. Century Insurance |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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