Correlation Between Karachi 100 and Treet
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By analyzing existing cross correlation between Karachi 100 and Treet, you can compare the effects of market volatilities on Karachi 100 and Treet 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 Treet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Karachi 100 and Treet.
Diversification Opportunities for Karachi 100 and Treet
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Karachi and Treet is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Karachi 100 and Treet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Treet 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 Treet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Treet has no effect on the direction of Karachi 100 i.e., Karachi 100 and Treet go up and down completely randomly.
Pair Corralation between Karachi 100 and Treet
Assuming the 90 days trading horizon Karachi 100 is expected to generate 4.22 times less return on investment than Treet. But when comparing it to its historical volatility, Karachi 100 is 2.78 times less risky than Treet. It trades about 0.09 of its potential returns per unit of risk. Treet is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 2,151 in Treet on November 29, 2024 and sell it today you would earn a total of 146.00 from holding Treet or generate 6.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Karachi 100 vs. Treet
Performance |
| Timeline |
Karachi 100 and Treet Volatility Contrast
Predicted Return Density |
| Returns |
Karachi 100
Pair trading matchups for Karachi 100
Treet
Pair trading matchups for Treet
Pair Trading with Karachi 100 and Treet
The main advantage of trading using opposite Karachi 100 and Treet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Karachi 100 position performs unexpectedly, Treet 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 Treet will offset losses from the drop in Treet's long position.| Karachi 100 vs. Universal Insurance | Karachi 100 vs. Bank of Punjab | Karachi 100 vs. Reliance Insurance Co | Karachi 100 vs. Century 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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