Correlation Between CORONATION INSURANCE and GUINEA INSURANCE
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By analyzing existing cross correlation between CORONATION INSURANCE PLC and GUINEA INSURANCE PLC, you can compare the effects of market volatilities on CORONATION INSURANCE and GUINEA 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 CORONATION INSURANCE with a short position of GUINEA INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of CORONATION INSURANCE and GUINEA INSURANCE.
Diversification Opportunities for CORONATION INSURANCE and GUINEA INSURANCE
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between CORONATION and GUINEA is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding CORONATION INSURANCE PLC and GUINEA INSURANCE PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GUINEA INSURANCE PLC and CORONATION 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 CORONATION INSURANCE PLC are associated (or correlated) with GUINEA INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GUINEA INSURANCE PLC has no effect on the direction of CORONATION INSURANCE i.e., CORONATION INSURANCE and GUINEA INSURANCE go up and down completely randomly.
Pair Corralation between CORONATION INSURANCE and GUINEA INSURANCE
Assuming the 90 days trading horizon CORONATION INSURANCE PLC is expected to generate 0.86 times more return on investment than GUINEA INSURANCE. However, CORONATION INSURANCE PLC is 1.17 times less risky than GUINEA INSURANCE. It trades about 0.21 of its potential returns per unit of risk. GUINEA INSURANCE PLC is currently generating about 0.04 per unit of risk. If you would invest 89.00 in CORONATION INSURANCE PLC on August 28, 2024 and sell it today you would earn a total of 16.00 from holding CORONATION INSURANCE PLC or generate 17.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CORONATION INSURANCE PLC vs. GUINEA INSURANCE PLC
Performance |
| Timeline |
| CORONATION INSURANCE PLC |
| GUINEA INSURANCE PLC |
CORONATION INSURANCE and GUINEA INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CORONATION INSURANCE and GUINEA INSURANCE
The main advantage of trading using opposite CORONATION INSURANCE and GUINEA INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CORONATION INSURANCE position performs unexpectedly, GUINEA 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 GUINEA INSURANCE will offset losses from the drop in GUINEA INSURANCE's long position.| CORONATION INSURANCE vs. GUINEA INSURANCE PLC | CORONATION INSURANCE vs. MEYER PLC | CORONATION INSURANCE vs. VETIVA INDUSTRIAL ETF |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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