Correlation Between Life Insurance and Thomas Scott
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By analyzing existing cross correlation between Life Insurance and Thomas Scott Limited, you can compare the effects of market volatilities on Life Insurance and Thomas Scott 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 Life Insurance with a short position of Thomas Scott. Check out your portfolio center. Please also check ongoing floating volatility patterns of Life Insurance and Thomas Scott.
Diversification Opportunities for Life Insurance and Thomas Scott
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Life and Thomas is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Life Insurance and Thomas Scott Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thomas Scott Limited and Life Insurance 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 Life Insurance are associated (or correlated) with Thomas Scott. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thomas Scott Limited has no effect on the direction of Life Insurance i.e., Life Insurance and Thomas Scott go up and down completely randomly.
Pair Corralation between Life Insurance and Thomas Scott
Assuming the 90 days trading horizon Life Insurance is expected to generate 13.2 times less return on investment than Thomas Scott. But when comparing it to its historical volatility, Life Insurance is 2.07 times less risky than Thomas Scott. It trades about 0.1 of its potential returns per unit of risk. Thomas Scott Limited is currently generating about 0.64 of returns per unit of risk over similar time horizon. If you would invest 20,916 in Thomas Scott Limited on September 14, 2024 and sell it today you would earn a total of 13,104 from holding Thomas Scott Limited or generate 62.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Life Insurance vs. Thomas Scott Limited
Performance |
| Timeline |
| Life Insurance |
| Thomas Scott Limited |
Life Insurance and Thomas Scott Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Life Insurance and Thomas Scott
The main advantage of trading using opposite Life Insurance and Thomas Scott positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Life Insurance position performs unexpectedly, Thomas Scott 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 Thomas Scott will offset losses from the drop in Thomas Scott's long position.| Life Insurance vs. Vodafone Idea Limited | Life Insurance vs. Yes Bank Limited | Life Insurance vs. Indian Overseas Bank | Life Insurance vs. Indian Oil |
| Thomas Scott vs. Reliance Industries Limited | Thomas Scott vs. Life Insurance | Thomas Scott vs. Indian Oil | Thomas Scott vs. Oil Natural Gas |
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 CEOs Directory module to screen CEOs from public companies around the world.
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