Correlation Between Grays Leasing and Jubilee Life
Can any of the company-specific risk be diversified away by investing in both Grays Leasing and Jubilee Life 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 Grays Leasing and Jubilee Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grays Leasing and Jubilee Life Insurance, you can compare the effects of market volatilities on Grays Leasing and Jubilee Life 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 Grays Leasing with a short position of Jubilee Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grays Leasing and Jubilee Life.
Diversification Opportunities for Grays Leasing and Jubilee Life
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Grays and Jubilee is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Grays Leasing and Jubilee Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jubilee Life Insurance and Grays Leasing 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 Grays Leasing are associated (or correlated) with Jubilee Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jubilee Life Insurance has no effect on the direction of Grays Leasing i.e., Grays Leasing and Jubilee Life go up and down completely randomly.
Pair Corralation between Grays Leasing and Jubilee Life
Assuming the 90 days trading horizon Grays Leasing is expected to generate 2.65 times more return on investment than Jubilee Life. However, Grays Leasing is 2.65 times more volatile than Jubilee Life Insurance. It trades about 0.06 of its potential returns per unit of risk. Jubilee Life Insurance is currently generating about 0.07 per unit of risk. If you would invest 310.00 in Grays Leasing on August 31, 2024 and sell it today you would earn a total of 132.00 from holding Grays Leasing or generate 42.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 55.11% |
| Values | Daily Returns |
Grays Leasing vs. Jubilee Life Insurance
Performance |
| Timeline |
| Grays Leasing |
| Jubilee Life Insurance |
Grays Leasing and Jubilee Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grays Leasing and Jubilee Life
The main advantage of trading using opposite Grays Leasing and Jubilee Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grays Leasing position performs unexpectedly, Jubilee Life 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 Jubilee Life will offset losses from the drop in Jubilee Life's long position.| Grays Leasing vs. Masood Textile Mills | Grays Leasing vs. Fauji Foods | Grays Leasing vs. KSB Pumps | Grays Leasing vs. Mari Petroleum |
| Jubilee Life vs. Pakistan Aluminium Beverage | Jubilee Life vs. Nimir Industrial Chemical | Jubilee Life vs. Ittehad Chemicals | Jubilee Life vs. Big Bird Foods |
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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