Correlation Between Indara Insurance and Prime Road
Can any of the company-specific risk be diversified away by investing in both Indara Insurance and Prime Road 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 Prime Road 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 Prime Road Power, you can compare the effects of market volatilities on Indara Insurance and Prime Road 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 Prime Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indara Insurance and Prime Road.
Diversification Opportunities for Indara Insurance and Prime Road
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Indara and Prime is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Indara Insurance Public and Prime Road Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prime Road Power 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 Prime Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prime Road Power has no effect on the direction of Indara Insurance i.e., Indara Insurance and Prime Road go up and down completely randomly.
Pair Corralation between Indara Insurance and Prime Road
Assuming the 90 days trading horizon Indara Insurance Public is expected to generate 1.0 times more return on investment than Prime Road. However, Indara Insurance Public is 1.0 times less risky than Prime Road. It trades about 0.05 of its potential returns per unit of risk. Prime Road Power is currently generating about 0.05 per unit of risk. If you would invest 11,500 in Indara Insurance Public on September 14, 2024 and sell it today you would lose (3,600) from holding Indara Insurance Public or give up 31.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indara Insurance Public vs. Prime Road Power
Performance |
| Timeline |
| Indara Insurance Public |
| Prime Road Power |
Indara Insurance and Prime Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indara Insurance and Prime Road
The main advantage of trading using opposite Indara Insurance and Prime Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indara Insurance position performs unexpectedly, Prime Road 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 Prime Road will offset losses from the drop in Prime Road's long position.| Indara Insurance vs. KGI Securities Public | Indara Insurance vs. Lalin Property Public | Indara Insurance vs. Hwa Fong Rubber | Indara Insurance vs. MCS Steel Public |
| Prime Road vs. BCPG Public | Prime Road vs. Energy Absolute Public | Prime Road vs. Gunkul Engineering Public | Prime Road vs. Gulf Energy Development |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |