Correlation Between Habib Insurance and Matco Foods
Can any of the company-specific risk be diversified away by investing in both Habib Insurance and Matco Foods 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 Matco Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Habib Insurance and Matco Foods, you can compare the effects of market volatilities on Habib Insurance and Matco Foods 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 Matco Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Habib Insurance and Matco Foods.
Diversification Opportunities for Habib Insurance and Matco Foods
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Habib and Matco is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Habib Insurance and Matco Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matco Foods 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 Matco Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matco Foods has no effect on the direction of Habib Insurance i.e., Habib Insurance and Matco Foods go up and down completely randomly.
Pair Corralation between Habib Insurance and Matco Foods
Assuming the 90 days trading horizon Habib Insurance is expected to generate 1.57 times more return on investment than Matco Foods. However, Habib Insurance is 1.57 times more volatile than Matco Foods. It trades about 0.03 of its potential returns per unit of risk. Matco Foods is currently generating about 0.01 per unit of risk. If you would invest 609.00 in Habib Insurance on August 28, 2024 and sell it today you would earn a total of 51.00 from holding Habib Insurance or generate 8.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 80.5% |
| Values | Daily Returns |
Habib Insurance vs. Matco Foods
Performance |
| Timeline |
| Habib Insurance |
| Matco Foods |
Habib Insurance and Matco Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Habib Insurance and Matco Foods
The main advantage of trading using opposite Habib Insurance and Matco Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Habib Insurance position performs unexpectedly, Matco Foods 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 Matco Foods will offset losses from the drop in Matco Foods' long position.| Habib Insurance vs. Habib Bank | Habib Insurance vs. National Bank of | Habib Insurance vs. United Bank | Habib Insurance vs. MCB Bank |
| Matco Foods vs. Dost Steels | Matco Foods vs. Atlas Insurance | Matco Foods vs. MCB Bank | Matco Foods vs. Askari Bank |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |