Correlation Between GUINEA INSURANCE and FIDSON HEALTHCARE
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By analyzing existing cross correlation between GUINEA INSURANCE PLC and FIDSON HEALTHCARE PLC, you can compare the effects of market volatilities on GUINEA INSURANCE and FIDSON HEALTHCARE 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 GUINEA INSURANCE with a short position of FIDSON HEALTHCARE. Check out your portfolio center. Please also check ongoing floating volatility patterns of GUINEA INSURANCE and FIDSON HEALTHCARE.
Diversification Opportunities for GUINEA INSURANCE and FIDSON HEALTHCARE
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between GUINEA and FIDSON is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding GUINEA INSURANCE PLC and FIDSON HEALTHCARE PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FIDSON HEALTHCARE PLC and GUINEA 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 GUINEA INSURANCE PLC are associated (or correlated) with FIDSON HEALTHCARE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FIDSON HEALTHCARE PLC has no effect on the direction of GUINEA INSURANCE i.e., GUINEA INSURANCE and FIDSON HEALTHCARE go up and down completely randomly.
Pair Corralation between GUINEA INSURANCE and FIDSON HEALTHCARE
Assuming the 90 days trading horizon GUINEA INSURANCE PLC is expected to under-perform the FIDSON HEALTHCARE. In addition to that, GUINEA INSURANCE is 1.42 times more volatile than FIDSON HEALTHCARE PLC. It trades about -0.2 of its total potential returns per unit of risk. FIDSON HEALTHCARE PLC is currently generating about 0.01 per unit of volatility. If you would invest 1,910 in FIDSON HEALTHCARE PLC on December 8, 2024 and sell it today you would lose (15.00) from holding FIDSON HEALTHCARE PLC or give up 0.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GUINEA INSURANCE PLC vs. FIDSON HEALTHCARE PLC
Performance |
| Timeline |
| GUINEA INSURANCE PLC |
| FIDSON HEALTHCARE PLC |
GUINEA INSURANCE and FIDSON HEALTHCARE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GUINEA INSURANCE and FIDSON HEALTHCARE
The main advantage of trading using opposite GUINEA INSURANCE and FIDSON HEALTHCARE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GUINEA INSURANCE position performs unexpectedly, FIDSON HEALTHCARE 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 FIDSON HEALTHCARE will offset losses from the drop in FIDSON HEALTHCARE's long position.| GUINEA INSURANCE vs. INTERNATIONAL BREWERIES PLC | ||
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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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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