Correlation Between Indara Insurance and Communication System
Can any of the company-specific risk be diversified away by investing in both Indara Insurance and Communication System 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 Indara Insurance and Communication System into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Indara Insurance Public and Communication System Solution, you can compare the effects of market volatilities on Indara Insurance and Communication System 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 Indara Insurance with a short position of Communication System. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indara Insurance and Communication System.
Diversification Opportunities for Indara Insurance and Communication System
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Indara and Communication is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Indara Insurance Public and Communication System Solution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Communication System and Indara 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 Indara Insurance Public are associated (or correlated) with Communication System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Communication System has no effect on the direction of Indara Insurance i.e., Indara Insurance and Communication System go up and down completely randomly.
Pair Corralation between Indara Insurance and Communication System
Assuming the 90 days trading horizon Indara Insurance Public is expected to generate 1.0 times more return on investment than Communication System. However, Indara Insurance Public is 1.0 times less risky than Communication System. It trades about 0.1 of its potential returns per unit of risk. Communication System Solution is currently generating about 0.1 per unit of risk. If you would invest 0.00 in Indara Insurance Public on November 2, 2024 and sell it today you would earn a total of 8,100 from holding Indara Insurance Public or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indara Insurance Public vs. Communication System Solution
Performance |
| Timeline |
| Indara Insurance Public |
| Communication System |
Indara Insurance and Communication System Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indara Insurance and Communication System
The main advantage of trading using opposite Indara Insurance and Communication System positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indara Insurance position performs unexpectedly, Communication System 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 Communication System will offset losses from the drop in Communication System's long position.| Indara Insurance vs. IFS Capital Public | Indara Insurance vs. Internet Thailand Public | Indara Insurance vs. Hwa Fong Rubber | Indara Insurance vs. Haad Thip Public |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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