Correlation Between Habib Insurance and First Al
Can any of the company-specific risk be diversified away by investing in both Habib Insurance and First Al 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 Habib Insurance and First Al into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Habib Insurance and First Al Noor Modaraba, you can compare the effects of market volatilities on Habib Insurance and First Al 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 Habib Insurance with a short position of First Al. Check out your portfolio center. Please also check ongoing floating volatility patterns of Habib Insurance and First Al.
Diversification Opportunities for Habib Insurance and First Al
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Habib and First is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Habib Insurance and First Al Noor Modaraba in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Al Noor and Habib 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 Habib Insurance are associated (or correlated) with First Al. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Al Noor has no effect on the direction of Habib Insurance i.e., Habib Insurance and First Al go up and down completely randomly.
Pair Corralation between Habib Insurance and First Al
Assuming the 90 days trading horizon Habib Insurance is expected to generate 0.67 times more return on investment than First Al. However, Habib Insurance is 1.49 times less risky than First Al. It trades about 0.07 of its potential returns per unit of risk. First Al Noor Modaraba is currently generating about 0.01 per unit of risk. If you would invest 602.00 in Habib Insurance on September 14, 2024 and sell it today you would earn a total of 264.00 from holding Habib Insurance or generate 43.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 56.45% |
| Values | Daily Returns |
Habib Insurance vs. First Al Noor Modaraba
Performance |
| Timeline |
| Habib Insurance |
| First Al Noor |
Habib Insurance and First Al Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Habib Insurance and First Al
The main advantage of trading using opposite Habib Insurance and First Al positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Habib Insurance position performs unexpectedly, First Al 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 First Al will offset losses from the drop in First Al's long position.| Habib Insurance vs. Pak Gulf Leasing | Habib Insurance vs. Air Link Communication | Habib Insurance vs. International Steels | Habib Insurance vs. Amreli Steels |
| First Al vs. Air Link Communication | First Al vs. WorldCall Telecom | First Al vs. Sardar Chemical Industries | First Al vs. Shaheen Insurance |
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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