Correlation Between GACM Technologies and Life Insurance
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By analyzing existing cross correlation between GACM Technologies Limited and Life Insurance, you can compare the effects of market volatilities on GACM Technologies 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 GACM Technologies with a short position of Life Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of GACM Technologies and Life Insurance.
Diversification Opportunities for GACM Technologies and Life Insurance
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GACM and Life is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding GACM Technologies Limited and Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Life Insurance and GACM Technologies 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 GACM Technologies Limited 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 GACM Technologies i.e., GACM Technologies and Life Insurance go up and down completely randomly.
Pair Corralation between GACM Technologies and Life Insurance
Assuming the 90 days trading horizon GACM Technologies Limited is expected to under-perform the Life Insurance. In addition to that, GACM Technologies is 1.65 times more volatile than Life Insurance. It trades about -0.21 of its total potential returns per unit of risk. Life Insurance is currently generating about 0.08 per unit of volatility. If you would invest 58,868 in Life Insurance on September 2, 2024 and sell it today you would earn a total of 39,682 from holding Life Insurance or generate 67.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.01% |
| Values | Daily Returns |
GACM Technologies Limited vs. Life Insurance
Performance |
| Timeline |
| GACM Technologies |
| Life Insurance |
GACM Technologies and Life Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GACM Technologies and Life Insurance
The main advantage of trading using opposite GACM Technologies and Life Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GACM Technologies 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.| GACM Technologies vs. Ami Organics Limited | GACM Technologies vs. Aarey Drugs Pharmaceuticals | GACM Technologies vs. HDFC Asset Management | GACM Technologies vs. Vinati Organics Limited |
| Life Insurance vs. Reliance Industries Limited | Life Insurance vs. Indian Oil | Life Insurance vs. Oil Natural Gas |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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