Correlation Between Ping An and Intel
Can any of the company-specific risk be diversified away by investing in both Ping An and Intel 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 Ping An and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ping An Insurance and Intel, you can compare the effects of market volatilities on Ping An and Intel 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 Ping An with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Intel.
Diversification Opportunities for Ping An and Intel
Poor diversification
The 3 months correlation between Ping and Intel is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and Ping An 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 Ping An Insurance are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Ping An i.e., Ping An and Intel go up and down completely randomly.
Pair Corralation between Ping An and Intel
Assuming the 90 days horizon Ping An Insurance is expected to under-perform the Intel. But the stock apears to be less risky and, when comparing its historical volatility, Ping An Insurance is 1.18 times less risky than Intel. The stock trades about -0.01 of its potential returns per unit of risk. The Intel is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 2,036 in Intel on September 4, 2024 and sell it today you would earn a total of 380.00 from holding Intel or generate 18.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ping An Insurance vs. Intel
Performance |
| Timeline |
| Ping An Insurance |
| Intel |
Ping An and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Intel
The main advantage of trading using opposite Ping An and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| Ping An vs. Sanyo Chemical Industries | Ping An vs. CHEMICAL INDUSTRIES | Ping An vs. Silicon Motion Technology | Ping An vs. Wayside Technology Group |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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