Correlation Between Nations Trust and Peoples Insurance
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By analyzing existing cross correlation between Nations Trust Bank and Peoples Insurance PLC, you can compare the effects of market volatilities on Nations Trust and Peoples 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 Nations Trust with a short position of Peoples Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nations Trust and Peoples Insurance.
Diversification Opportunities for Nations Trust and Peoples Insurance
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nations and Peoples is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Nations Trust Bank and Peoples Insurance PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peoples Insurance PLC and Nations Trust 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 Nations Trust Bank are associated (or correlated) with Peoples Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peoples Insurance PLC has no effect on the direction of Nations Trust i.e., Nations Trust and Peoples Insurance go up and down completely randomly.
Pair Corralation between Nations Trust and Peoples Insurance
Assuming the 90 days trading horizon Nations Trust Bank is expected to generate 1.11 times more return on investment than Peoples Insurance. However, Nations Trust is 1.11 times more volatile than Peoples Insurance PLC. It trades about 0.36 of its potential returns per unit of risk. Peoples Insurance PLC is currently generating about -0.13 per unit of risk. If you would invest 13,825 in Nations Trust Bank on September 2, 2024 and sell it today you would earn a total of 1,425 from holding Nations Trust Bank or generate 10.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nations Trust Bank vs. Peoples Insurance PLC
Performance |
| Timeline |
| Nations Trust Bank |
| Peoples Insurance PLC |
Nations Trust and Peoples Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nations Trust and Peoples Insurance
The main advantage of trading using opposite Nations Trust and Peoples Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nations Trust position performs unexpectedly, Peoples 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 Peoples Insurance will offset losses from the drop in Peoples Insurance's long position.| Nations Trust vs. Prime Lands Residencies | Nations Trust vs. VIDULLANKA PLC | Nations Trust vs. EX PACK RUGATED CARTONS |
| Peoples Insurance vs. National Development Bank | Peoples Insurance vs. Sampath Bank PLC | Peoples Insurance vs. Union Bank | Peoples Insurance vs. Convenience Foods PLC |
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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