Correlation Between HNB Finance and Peoples Insurance
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By analyzing existing cross correlation between HNB Finance and Peoples Insurance PLC, you can compare the effects of market volatilities on HNB Finance and Peoples 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 HNB Finance with a short position of Peoples Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of HNB Finance and Peoples Insurance.
Diversification Opportunities for HNB Finance and Peoples Insurance
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HNB and Peoples is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding HNB Finance and Peoples Insurance PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peoples Insurance PLC and HNB Finance 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 HNB Finance are associated (or correlated) with Peoples Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peoples Insurance PLC has no effect on the direction of HNB Finance i.e., HNB Finance and Peoples Insurance go up and down completely randomly.
Pair Corralation between HNB Finance and Peoples Insurance
Assuming the 90 days trading horizon HNB Finance is expected to under-perform the Peoples Insurance. In addition to that, HNB Finance is 1.92 times more volatile than Peoples Insurance PLC. It trades about -0.02 of its total potential returns per unit of risk. Peoples Insurance PLC is currently generating about 0.17 per unit of volatility. If you would invest 2,200 in Peoples Insurance PLC on September 25, 2024 and sell it today you would earn a total of 550.00 from holding Peoples Insurance PLC or generate 25.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
HNB Finance vs. Peoples Insurance PLC
Performance |
Timeline |
HNB Finance |
Peoples Insurance PLC |
HNB Finance and Peoples Insurance Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with HNB Finance and Peoples Insurance
The main advantage of trading using opposite HNB Finance and Peoples Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HNB Finance position performs unexpectedly, Peoples 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 Peoples Insurance will offset losses from the drop in Peoples Insurance's long position.HNB Finance vs. Keells Food Products | HNB Finance vs. Peoples Insurance PLC | HNB Finance vs. Pan Asia Banking | HNB Finance vs. Union Bank |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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