Correlation Between Spencers Retail and General Insuranceof
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By analyzing existing cross correlation between Spencers Retail Limited and General Insurance, you can compare the effects of market volatilities on Spencers Retail and General Insuranceof 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 Spencers Retail with a short position of General Insuranceof. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spencers Retail and General Insuranceof.
Diversification Opportunities for Spencers Retail and General Insuranceof
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Spencers and General is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Spencers Retail Limited and General Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General Insuranceof and Spencers Retail 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 Spencers Retail Limited are associated (or correlated) with General Insuranceof. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General Insuranceof has no effect on the direction of Spencers Retail i.e., Spencers Retail and General Insuranceof go up and down completely randomly.
Pair Corralation between Spencers Retail and General Insuranceof
Assuming the 90 days trading horizon Spencers Retail Limited is expected to under-perform the General Insuranceof. In addition to that, Spencers Retail is 1.11 times more volatile than General Insurance. It trades about -0.29 of its total potential returns per unit of risk. General Insurance is currently generating about -0.12 per unit of volatility. If you would invest 41,560 in General Insurance on December 8, 2024 and sell it today you would lose (3,320) from holding General Insurance or give up 7.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spencers Retail Limited vs. General Insurance
Performance |
| Timeline |
| Spencers Retail |
| General Insuranceof |
Spencers Retail and General Insuranceof Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spencers Retail and General Insuranceof
The main advantage of trading using opposite Spencers Retail and General Insuranceof positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spencers Retail position performs unexpectedly, General Insuranceof 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 Insuranceof will offset losses from the drop in General Insuranceof's long position.| Spencers Retail vs. Le Travenues Technology | Spencers Retail vs. FCS Software Solutions | Spencers Retail vs. Indraprastha Medical | Spencers Retail vs. Syrma SGS Technology |
| General Insuranceof vs. The Hi Tech Gears | General Insuranceof vs. Hi Tech Pipes Limited | General Insuranceof vs. Gallantt Ispat Limited | General Insuranceof vs. Indraprastha Medical |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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