Correlation Between Jubilee Life and Hi Tech
Can any of the company-specific risk be diversified away by investing in both Jubilee Life and Hi Tech 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 Jubilee Life and Hi Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jubilee Life Insurance and Hi Tech Lubricants, you can compare the effects of market volatilities on Jubilee Life and Hi Tech 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 Jubilee Life with a short position of Hi Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jubilee Life and Hi Tech.
Diversification Opportunities for Jubilee Life and Hi Tech
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jubilee and HTL is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Jubilee Life Insurance and Hi Tech Lubricants in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hi Tech Lubricants and Jubilee Life 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 Jubilee Life Insurance are associated (or correlated) with Hi Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hi Tech Lubricants has no effect on the direction of Jubilee Life i.e., Jubilee Life and Hi Tech go up and down completely randomly.
Pair Corralation between Jubilee Life and Hi Tech
Assuming the 90 days trading horizon Jubilee Life is expected to generate 1.21 times less return on investment than Hi Tech. But when comparing it to its historical volatility, Jubilee Life Insurance is 1.2 times less risky than Hi Tech. It trades about 0.07 of its potential returns per unit of risk. Hi Tech Lubricants is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,251 in Hi Tech Lubricants on October 13, 2024 and sell it today you would earn a total of 2,537 from holding Hi Tech Lubricants or generate 112.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 97.73% |
| Values | Daily Returns |
Jubilee Life Insurance vs. Hi Tech Lubricants
Performance |
| Timeline |
| Jubilee Life Insurance |
| Hi Tech Lubricants |
Jubilee Life and Hi Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jubilee Life and Hi Tech
The main advantage of trading using opposite Jubilee Life and Hi Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jubilee Life position performs unexpectedly, Hi Tech 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 Hi Tech will offset losses from the drop in Hi Tech's long position.| Jubilee Life vs. Masood Textile Mills | Jubilee Life vs. Fauji Foods | Jubilee Life vs. KSB Pumps | Jubilee Life vs. Mari Petroleum |
| Hi Tech vs. Fateh Sports Wear | Hi Tech vs. JS Investments | Hi Tech vs. Pakistan Hotel Developers | Hi Tech vs. Ghandhara Automobile |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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