Correlation Between Karachi 100 and Bilal Fibres
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By analyzing existing cross correlation between Karachi 100 and Bilal Fibres, you can compare the effects of market volatilities on Karachi 100 and Bilal Fibres 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 Karachi 100 with a short position of Bilal Fibres. Check out your portfolio center. Please also check ongoing floating volatility patterns of Karachi 100 and Bilal Fibres.
Diversification Opportunities for Karachi 100 and Bilal Fibres
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Karachi and Bilal is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Karachi 100 and Bilal Fibres in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bilal Fibres and Karachi 100 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 Karachi 100 are associated (or correlated) with Bilal Fibres. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bilal Fibres has no effect on the direction of Karachi 100 i.e., Karachi 100 and Bilal Fibres go up and down completely randomly.
Pair Corralation between Karachi 100 and Bilal Fibres
Assuming the 90 days trading horizon Karachi 100 is expected to generate 0.19 times more return on investment than Bilal Fibres. However, Karachi 100 is 5.26 times less risky than Bilal Fibres. It trades about 0.26 of its potential returns per unit of risk. Bilal Fibres is currently generating about 0.01 per unit of risk. If you would invest 9,086,409 in Karachi 100 on August 30, 2024 and sell it today you would earn a total of 840,516 from holding Karachi 100 or generate 9.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Karachi 100 vs. Bilal Fibres
Performance |
| Timeline |
Karachi 100 and Bilal Fibres Volatility Contrast
Predicted Return Density |
| Returns |
Karachi 100
Pair trading matchups for Karachi 100
Bilal Fibres
Pair trading matchups for Bilal Fibres
Pair Trading with Karachi 100 and Bilal Fibres
The main advantage of trading using opposite Karachi 100 and Bilal Fibres positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Karachi 100 position performs unexpectedly, Bilal Fibres 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 Bilal Fibres will offset losses from the drop in Bilal Fibres' long position.| Karachi 100 vs. National Bank of | Karachi 100 vs. Hi Tech Lubricants | Karachi 100 vs. Atlas Insurance | Karachi 100 vs. Security Investment Bank |
| Bilal Fibres vs. Big Bird Foods | Bilal Fibres vs. Matco Foods | Bilal Fibres vs. Adamjee Insurance | Bilal Fibres vs. AKD Hospitality |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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