Correlation Between SBI Life and UCO Bank
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By analyzing existing cross correlation between SBI Life Insurance and UCO Bank, you can compare the effects of market volatilities on SBI Life and UCO Bank 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 SBI Life with a short position of UCO Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBI Life and UCO Bank.
Diversification Opportunities for SBI Life and UCO Bank
Significant diversification
The 3 months correlation between SBI and UCO is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding SBI Life Insurance and UCO Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UCO Bank and SBI Life 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 SBI Life Insurance are associated (or correlated) with UCO Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UCO Bank has no effect on the direction of SBI Life i.e., SBI Life and UCO Bank go up and down completely randomly.
Pair Corralation between SBI Life and UCO Bank
Assuming the 90 days trading horizon SBI Life Insurance is expected to generate 0.3 times more return on investment than UCO Bank. However, SBI Life Insurance is 3.39 times less risky than UCO Bank. It trades about 0.31 of its potential returns per unit of risk. UCO Bank is currently generating about -0.03 per unit of risk. If you would invest 140,590 in SBI Life Insurance on October 20, 2024 and sell it today you would earn a total of 13,460 from holding SBI Life Insurance or generate 9.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
SBI Life Insurance vs. UCO Bank
Performance |
| Timeline |
| SBI Life Insurance |
| UCO Bank |
SBI Life and UCO Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBI Life and UCO Bank
The main advantage of trading using opposite SBI Life and UCO Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBI Life position performs unexpectedly, UCO Bank 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 UCO Bank will offset losses from the drop in UCO Bank's long position.| SBI Life vs. Bajaj Healthcare Limited | SBI Life vs. Sri Havisha Hospitality | SBI Life vs. GPT Healthcare | SBI Life vs. Kavveri Telecom Products |
| UCO Bank vs. AVALON TECHNOLOGIES LTD | UCO Bank vs. Arrow Greentech Limited | UCO Bank vs. Alkali Metals Limited | UCO Bank vs. Kingfa Science Technology |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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