Correlation Between SANLAM and CIG PANNONIA
Can any of the company-specific risk be diversified away by investing in both SANLAM and CIG PANNONIA 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 SANLAM and CIG PANNONIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SANLAM LTD RC 01 and CIG PANNONIA LIFE, you can compare the effects of market volatilities on SANLAM and CIG PANNONIA 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 SANLAM with a short position of CIG PANNONIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of SANLAM and CIG PANNONIA.
Diversification Opportunities for SANLAM and CIG PANNONIA
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SANLAM and CIG is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding SANLAM LTD RC 01 and CIG PANNONIA LIFE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIG PANNONIA LIFE and SANLAM 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 SANLAM LTD RC 01 are associated (or correlated) with CIG PANNONIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIG PANNONIA LIFE has no effect on the direction of SANLAM i.e., SANLAM and CIG PANNONIA go up and down completely randomly.
Pair Corralation between SANLAM and CIG PANNONIA
Assuming the 90 days trading horizon SANLAM LTD RC 01 is expected to under-perform the CIG PANNONIA. In addition to that, SANLAM is 1.46 times more volatile than CIG PANNONIA LIFE. It trades about -0.08 of its total potential returns per unit of risk. CIG PANNONIA LIFE is currently generating about 0.48 per unit of volatility. If you would invest 85.00 in CIG PANNONIA LIFE on October 25, 2024 and sell it today you would earn a total of 11.00 from holding CIG PANNONIA LIFE or generate 12.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SANLAM LTD RC 01 vs. CIG PANNONIA LIFE
Performance |
| Timeline |
| SANLAM LTD RC |
| CIG PANNONIA LIFE |
SANLAM and CIG PANNONIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SANLAM and CIG PANNONIA
The main advantage of trading using opposite SANLAM and CIG PANNONIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SANLAM position performs unexpectedly, CIG PANNONIA 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 CIG PANNONIA will offset losses from the drop in CIG PANNONIA's long position.| SANLAM vs. REINET INVESTMENTS SCA | SANLAM vs. MidCap Financial Investment | SANLAM vs. Maple Leaf Foods | SANLAM vs. PennantPark Investment |
| CIG PANNONIA vs. Diamyd Medical AB | CIG PANNONIA vs. Meli Hotels International | CIG PANNONIA vs. Park Hotels Resorts | CIG PANNONIA vs. Apollo Medical Holdings |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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