Correlation Between Shaheen Insurance and Karachi 100
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By analyzing existing cross correlation between Shaheen Insurance and Karachi 100, you can compare the effects of market volatilities on Shaheen Insurance and Karachi 100 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 Shaheen Insurance with a short position of Karachi 100. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaheen Insurance and Karachi 100.
Diversification Opportunities for Shaheen Insurance and Karachi 100
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shaheen and Karachi is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Shaheen Insurance and Karachi 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Karachi 100 and Shaheen Insurance 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 Shaheen Insurance are associated (or correlated) with Karachi 100. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Karachi 100 has no effect on the direction of Shaheen Insurance i.e., Shaheen Insurance and Karachi 100 go up and down completely randomly.
Pair Corralation between Shaheen Insurance and Karachi 100
Assuming the 90 days trading horizon Shaheen Insurance is expected to generate 2.01 times more return on investment than Karachi 100. However, Shaheen Insurance is 2.01 times more volatile than Karachi 100. It trades about 0.29 of its potential returns per unit of risk. Karachi 100 is currently generating about 0.41 per unit of risk. If you would invest 502.00 in Shaheen Insurance on September 1, 2024 and sell it today you would earn a total of 97.00 from holding Shaheen Insurance or generate 19.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shaheen Insurance vs. Karachi 100
Performance |
| Timeline |
Shaheen Insurance and Karachi 100 Volatility Contrast
Predicted Return Density |
| Returns |
Shaheen Insurance
Pair trading matchups for Shaheen Insurance
Karachi 100
Pair trading matchups for Karachi 100
Pair Trading with Shaheen Insurance and Karachi 100
The main advantage of trading using opposite Shaheen Insurance and Karachi 100 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaheen Insurance position performs unexpectedly, Karachi 100 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 Karachi 100 will offset losses from the drop in Karachi 100's long position.| Shaheen Insurance vs. Habib Bank | Shaheen Insurance vs. National Bank of | Shaheen Insurance vs. United Bank | Shaheen Insurance vs. MCB Bank |
| Karachi 100 vs. Nimir Industrial Chemical | Karachi 100 vs. Shaheen Insurance | Karachi 100 vs. Pakistan Telecommunication | Karachi 100 vs. Reliance Insurance Co |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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