Correlation Between Nimir Industrial and Premier Insurance
Can any of the company-specific risk be diversified away by investing in both Nimir Industrial and Premier Insurance 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 Nimir Industrial and Premier Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nimir Industrial Chemical and Premier Insurance, you can compare the effects of market volatilities on Nimir Industrial and Premier Insurance 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 Nimir Industrial with a short position of Premier Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nimir Industrial and Premier Insurance.
Diversification Opportunities for Nimir Industrial and Premier Insurance
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Nimir and Premier is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Nimir Industrial Chemical and Premier Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Premier Insurance and Nimir Industrial 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 Nimir Industrial Chemical are associated (or correlated) with Premier Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Premier Insurance has no effect on the direction of Nimir Industrial i.e., Nimir Industrial and Premier Insurance go up and down completely randomly.
Pair Corralation between Nimir Industrial and Premier Insurance
Assuming the 90 days trading horizon Nimir Industrial Chemical is expected to generate 0.44 times more return on investment than Premier Insurance. However, Nimir Industrial Chemical is 2.28 times less risky than Premier Insurance. It trades about 0.09 of its potential returns per unit of risk. Premier Insurance is currently generating about 0.03 per unit of risk. If you would invest 5,444 in Nimir Industrial Chemical on September 14, 2024 and sell it today you would earn a total of 8,748 from holding Nimir Industrial Chemical or generate 160.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 75.89% |
| Values | Daily Returns |
Nimir Industrial Chemical vs. Premier Insurance
Performance |
| Timeline |
| Nimir Industrial Chemical |
| Premier Insurance |
Nimir Industrial and Premier Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nimir Industrial and Premier Insurance
The main advantage of trading using opposite Nimir Industrial and Premier Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nimir Industrial position performs unexpectedly, Premier Insurance 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 Premier Insurance will offset losses from the drop in Premier Insurance's long position.| Nimir Industrial vs. Masood Textile Mills | Nimir Industrial vs. Fauji Foods | Nimir Industrial vs. KSB Pumps | Nimir Industrial vs. Mari Petroleum |
| Premier Insurance vs. JS Investments | Premier Insurance vs. MCB Investment Manag | Premier Insurance vs. Security Investment Bank | Premier Insurance vs. Nimir Industrial Chemical |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |