Correlation Between PING AN and OLD MUTUAL
Can any of the company-specific risk be diversified away by investing in both PING AN and OLD MUTUAL 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 OLD MUTUAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PING AN INSURANCH and OLD MUTUAL LTD, you can compare the effects of market volatilities on PING AN and OLD MUTUAL 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 OLD MUTUAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of PING AN and OLD MUTUAL.
Diversification Opportunities for PING AN and OLD MUTUAL
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between PING and OLD is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding PING AN INSURANCH and OLD MUTUAL LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OLD MUTUAL LTD 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 INSURANCH are associated (or correlated) with OLD MUTUAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OLD MUTUAL LTD has no effect on the direction of PING AN i.e., PING AN and OLD MUTUAL go up and down completely randomly.
Pair Corralation between PING AN and OLD MUTUAL
Assuming the 90 days trading horizon PING AN INSURANCH is expected to under-perform the OLD MUTUAL. In addition to that, PING AN is 1.05 times more volatile than OLD MUTUAL LTD. It trades about -0.29 of its total potential returns per unit of risk. OLD MUTUAL LTD is currently generating about -0.17 per unit of volatility. If you would invest 64.00 in OLD MUTUAL LTD on October 25, 2024 and sell it today you would lose (4.00) from holding OLD MUTUAL LTD or give up 6.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PING AN INSURANCH vs. OLD MUTUAL LTD
Performance |
| Timeline |
| PING AN INSURANCH |
| OLD MUTUAL LTD |
PING AN and OLD MUTUAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PING AN and OLD MUTUAL
The main advantage of trading using opposite PING AN and OLD MUTUAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PING AN position performs unexpectedly, OLD MUTUAL 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 OLD MUTUAL will offset losses from the drop in OLD MUTUAL's long position.| PING AN vs. JSC Halyk bank | PING AN vs. T MOBILE US | PING AN vs. Erste Group Bank | PING AN vs. Ameriprise Financial |
| OLD MUTUAL vs. Thai Beverage Public | OLD MUTUAL vs. TreeHouse Foods | OLD MUTUAL vs. PULSION Medical Systems | OLD MUTUAL vs. Medical Properties Trust |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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