Correlation Between Salzer Electronics and General Insurance
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By analyzing existing cross correlation between Salzer Electronics Limited and General Insurance, you can compare the effects of market volatilities on Salzer Electronics and General 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 Salzer Electronics with a short position of General Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salzer Electronics and General Insurance.
Diversification Opportunities for Salzer Electronics and General Insurance
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Salzer and General is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Salzer Electronics Limited and General Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Insurance and Salzer Electronics 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 Salzer Electronics Limited are associated (or correlated) with General Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Insurance has no effect on the direction of Salzer Electronics i.e., Salzer Electronics and General Insurance go up and down completely randomly.
Pair Corralation between Salzer Electronics and General Insurance
Assuming the 90 days trading horizon Salzer Electronics Limited is expected to generate 0.97 times more return on investment than General Insurance. However, Salzer Electronics Limited is 1.03 times less risky than General Insurance. It trades about 0.11 of its potential returns per unit of risk. General Insurance is currently generating about 0.08 per unit of risk. If you would invest 25,119 in Salzer Electronics Limited on September 3, 2024 and sell it today you would earn a total of 86,671 from holding Salzer Electronics Limited or generate 345.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Salzer Electronics Limited vs. General Insurance
Performance |
| Timeline |
| Salzer Electronics |
| General Insurance |
Salzer Electronics and General Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salzer Electronics and General Insurance
The main advantage of trading using opposite Salzer Electronics and General Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salzer Electronics position performs unexpectedly, General 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 General Insurance will offset losses from the drop in General Insurance's long position.| Salzer Electronics vs. General Insurance | Salzer Electronics vs. Pritish Nandy Communications | Salzer Electronics vs. Tata Communications Limited | Salzer Electronics vs. BF Utilities Limited |
| General Insurance vs. Tata Communications Limited | General Insurance vs. Kalyani Steels Limited | General Insurance vs. KNR Constructions Limited | General Insurance vs. Bigbloc Construction Limited |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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