Correlation Between Military Insurance and Atesco Industrial
Can any of the company-specific risk be diversified away by investing in both Military Insurance and Atesco Industrial 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 Military Insurance and Atesco Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Military Insurance Corp and Atesco Industrial Cartering, you can compare the effects of market volatilities on Military Insurance and Atesco Industrial 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 Military Insurance with a short position of Atesco Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Military Insurance and Atesco Industrial.
Diversification Opportunities for Military Insurance and Atesco Industrial
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Military and Atesco is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Military Insurance Corp and Atesco Industrial Cartering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atesco Industrial and Military 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 Military Insurance Corp are associated (or correlated) with Atesco Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atesco Industrial has no effect on the direction of Military Insurance i.e., Military Insurance and Atesco Industrial go up and down completely randomly.
Pair Corralation between Military Insurance and Atesco Industrial
Assuming the 90 days trading horizon Military Insurance is expected to generate 6.64 times less return on investment than Atesco Industrial. But when comparing it to its historical volatility, Military Insurance Corp is 2.56 times less risky than Atesco Industrial. It trades about 0.06 of its potential returns per unit of risk. Atesco Industrial Cartering is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 1,300,000 in Atesco Industrial Cartering on September 12, 2024 and sell it today you would earn a total of 220,000 from holding Atesco Industrial Cartering or generate 16.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Military Insurance Corp vs. Atesco Industrial Cartering
Performance |
| Timeline |
| Military Insurance Corp |
| Atesco Industrial |
Military Insurance and Atesco Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Military Insurance and Atesco Industrial
The main advantage of trading using opposite Military Insurance and Atesco Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Military Insurance position performs unexpectedly, Atesco Industrial 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 Atesco Industrial will offset losses from the drop in Atesco Industrial's long position.| Military Insurance vs. FIT INVEST JSC | Military Insurance vs. Damsan JSC | Military Insurance vs. An Phat Plastic | Military Insurance vs. Alphanam ME |
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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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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