Correlation Between Grays Leasing and ORIX Leasing
Can any of the company-specific risk be diversified away by investing in both Grays Leasing and ORIX Leasing 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 ORIX Leasing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grays Leasing and ORIX Leasing Pakistan, you can compare the effects of market volatilities on Grays Leasing and ORIX Leasing 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 ORIX Leasing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grays Leasing and ORIX Leasing.
Diversification Opportunities for Grays Leasing and ORIX Leasing
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Grays and ORIX is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Grays Leasing and ORIX Leasing Pakistan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ORIX Leasing Pakistan 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 ORIX Leasing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ORIX Leasing Pakistan has no effect on the direction of Grays Leasing i.e., Grays Leasing and ORIX Leasing go up and down completely randomly.
Pair Corralation between Grays Leasing and ORIX Leasing
Assuming the 90 days trading horizon Grays Leasing is expected to generate 3.18 times more return on investment than ORIX Leasing. However, Grays Leasing is 3.18 times more volatile than ORIX Leasing Pakistan. It trades about 0.07 of its potential returns per unit of risk. ORIX Leasing Pakistan is currently generating about 0.14 per unit of risk. If you would invest 409.00 in Grays Leasing on October 13, 2024 and sell it today you would earn a total of 157.00 from holding Grays Leasing or generate 38.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 92.86% |
| Values | Daily Returns |
Grays Leasing vs. ORIX Leasing Pakistan
Performance |
| Timeline |
| Grays Leasing |
| ORIX Leasing Pakistan |
Grays Leasing and ORIX Leasing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grays Leasing and ORIX Leasing
The main advantage of trading using opposite Grays Leasing and ORIX Leasing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grays Leasing position performs unexpectedly, ORIX Leasing 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 ORIX Leasing will offset losses from the drop in ORIX Leasing's long position.| Grays Leasing vs. Engro Polymer Chemicals | Grays Leasing vs. Ittehad Chemicals | Grays Leasing vs. Hi Tech Lubricants | Grays Leasing vs. Nimir Industrial Chemical |
| ORIX Leasing vs. Fauji Foods | ORIX Leasing vs. Universal Insurance | ORIX Leasing vs. JS Global Banking | ORIX Leasing vs. NetSol Technologies |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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