Correlation Between Jubilee Life and TPL Insurance
Can any of the company-specific risk be diversified away by investing in both Jubilee Life and TPL Insurance 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 TPL Insurance 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 TPL Insurance, you can compare the effects of market volatilities on Jubilee Life and TPL Insurance 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 TPL Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jubilee Life and TPL Insurance.
Diversification Opportunities for Jubilee Life and TPL Insurance
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jubilee and TPL is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Jubilee Life Insurance and TPL Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TPL Insurance 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 TPL Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TPL Insurance has no effect on the direction of Jubilee Life i.e., Jubilee Life and TPL Insurance go up and down completely randomly.
Pair Corralation between Jubilee Life and TPL Insurance
Assuming the 90 days trading horizon Jubilee Life Insurance is expected to generate 1.0 times more return on investment than TPL Insurance. However, Jubilee Life Insurance is 1.0 times less risky than TPL Insurance. It trades about 0.29 of its potential returns per unit of risk. TPL Insurance is currently generating about 0.12 per unit of risk. If you would invest 12,796 in Jubilee Life Insurance on September 2, 2024 and sell it today you would earn a total of 2,755 from holding Jubilee Life Insurance or generate 21.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jubilee Life Insurance vs. TPL Insurance
Performance |
| Timeline |
| Jubilee Life Insurance |
| TPL Insurance |
Jubilee Life and TPL Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jubilee Life and TPL Insurance
The main advantage of trading using opposite Jubilee Life and TPL Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jubilee Life position performs unexpectedly, TPL Insurance 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 TPL Insurance will offset losses from the drop in TPL Insurance's long position.| Jubilee Life vs. Habib Bank | Jubilee Life vs. National Bank of | Jubilee Life vs. United Bank | Jubilee Life vs. MCB Bank |
| TPL Insurance vs. Jubilee Life Insurance | TPL Insurance vs. Big Bird Foods | TPL Insurance vs. Shaheen Insurance | TPL Insurance vs. Atlas 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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