Correlation Between PICIC Insurance and Crescent Star
Can any of the company-specific risk be diversified away by investing in both PICIC Insurance and Crescent Star 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 PICIC Insurance and Crescent Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PICIC Insurance and Crescent Star Insurance, you can compare the effects of market volatilities on PICIC Insurance and Crescent Star 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 PICIC Insurance with a short position of Crescent Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of PICIC Insurance and Crescent Star.
Diversification Opportunities for PICIC Insurance and Crescent Star
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between PICIC and Crescent is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding PICIC Insurance and Crescent Star Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crescent Star Insurance and PICIC 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 PICIC Insurance are associated (or correlated) with Crescent Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crescent Star Insurance has no effect on the direction of PICIC Insurance i.e., PICIC Insurance and Crescent Star go up and down completely randomly.
Pair Corralation between PICIC Insurance and Crescent Star
Assuming the 90 days trading horizon PICIC Insurance is expected to generate 2.86 times more return on investment than Crescent Star. However, PICIC Insurance is 2.86 times more volatile than Crescent Star Insurance. It trades about 0.02 of its potential returns per unit of risk. Crescent Star Insurance is currently generating about 0.02 per unit of risk. If you would invest 191.00 in PICIC Insurance on November 30, 2024 and sell it today you would lose (3.00) from holding PICIC Insurance or give up 1.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PICIC Insurance vs. Crescent Star Insurance
Performance |
| Timeline |
| PICIC Insurance |
| Crescent Star Insurance |
PICIC Insurance and Crescent Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PICIC Insurance and Crescent Star
The main advantage of trading using opposite PICIC Insurance and Crescent Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PICIC Insurance position performs unexpectedly, Crescent Star 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 Crescent Star will offset losses from the drop in Crescent Star's long position.| PICIC Insurance vs. Faysal Bank | PICIC Insurance vs. Engro Polymer Chemicals | PICIC Insurance vs. Unity Foods | PICIC Insurance vs. United Insurance |
| Crescent Star vs. Nimir Industrial Chemical | Crescent Star vs. First Fidelity Leasing | Crescent Star vs. ORIX Leasing Pakistan | Crescent Star vs. Metropolitan Steel Corp |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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