Correlation Between Ping An and TRIP GROUP
Can any of the company-specific risk be diversified away by investing in both Ping An and TRIP GROUP 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 TRIP GROUP 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 TRIPCOM GROUP DL 00125, you can compare the effects of market volatilities on Ping An and TRIP GROUP 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 TRIP GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and TRIP GROUP.
Diversification Opportunities for Ping An and TRIP GROUP
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Ping and TRIP is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and TRIPCOM GROUP DL 00125 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRIPCOM GROUP DL 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 TRIP GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRIPCOM GROUP DL has no effect on the direction of Ping An i.e., Ping An and TRIP GROUP go up and down completely randomly.
Pair Corralation between Ping An and TRIP GROUP
Assuming the 90 days trading horizon Ping An Insurance is expected to generate 1.11 times more return on investment than TRIP GROUP. However, Ping An is 1.11 times more volatile than TRIPCOM GROUP DL 00125. It trades about 0.07 of its potential returns per unit of risk. TRIPCOM GROUP DL 00125 is currently generating about 0.05 per unit of risk. If you would invest 211.00 in Ping An Insurance on August 31, 2024 and sell it today you would earn a total of 329.00 from holding Ping An Insurance or generate 155.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ping An Insurance vs. TRIPCOM GROUP DL 00125
Performance |
| Timeline |
| Ping An Insurance |
| TRIPCOM GROUP DL |
Ping An and TRIP GROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and TRIP GROUP
The main advantage of trading using opposite Ping An and TRIP GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, TRIP GROUP 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 TRIP GROUP will offset losses from the drop in TRIP GROUP's long position.| Ping An vs. Southwest Airlines Co | Ping An vs. Selective Insurance Group | Ping An vs. MOVIE GAMES SA | Ping An vs. Reinsurance Group of |
| TRIP GROUP vs. Science Applications International | TRIP GROUP vs. DATAGROUP SE | TRIP GROUP vs. ALERION CLEANPOWER | TRIP GROUP vs. TERADATA |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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