Correlation Between General Insurance and Eros International
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By analyzing existing cross correlation between General Insurance and Eros International Media, you can compare the effects of market volatilities on General Insurance and Eros International 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 General Insurance with a short position of Eros International. Check out your portfolio center. Please also check ongoing floating volatility patterns of General Insurance and Eros International.
Diversification Opportunities for General Insurance and Eros International
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between General and Eros is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding General Insurance and Eros International Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eros International Media and General 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 General Insurance are associated (or correlated) with Eros International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eros International Media has no effect on the direction of General Insurance i.e., General Insurance and Eros International go up and down completely randomly.
Pair Corralation between General Insurance and Eros International
Assuming the 90 days trading horizon General Insurance is expected to generate 0.9 times more return on investment than Eros International. However, General Insurance is 1.11 times less risky than Eros International. It trades about 0.2 of its potential returns per unit of risk. Eros International Media is currently generating about -0.17 per unit of risk. If you would invest 36,030 in General Insurance on August 28, 2024 and sell it today you would earn a total of 3,405 from holding General Insurance or generate 9.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
General Insurance vs. Eros International Media
Performance |
| Timeline |
| General Insurance |
| Eros International Media |
General Insurance and Eros International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with General Insurance and Eros International
The main advantage of trading using opposite General Insurance and Eros International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if General Insurance position performs unexpectedly, Eros International 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 Eros International will offset losses from the drop in Eros International's long position.| General Insurance vs. Manaksia Coated Metals | General Insurance vs. Newgen Software Technologies | General Insurance vs. Indian Metals Ferro | General Insurance vs. Sonata Software 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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