Correlation Between Peoples Insurance and Pan Asia
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By analyzing existing cross correlation between Peoples Insurance PLC and Pan Asia Banking, you can compare the effects of market volatilities on Peoples Insurance and Pan Asia 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 Peoples Insurance with a short position of Pan Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peoples Insurance and Pan Asia.
Diversification Opportunities for Peoples Insurance and Pan Asia
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Peoples and Pan is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Peoples Insurance PLC and Pan Asia Banking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pan Asia Banking and Peoples 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 Peoples Insurance PLC are associated (or correlated) with Pan Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pan Asia Banking has no effect on the direction of Peoples Insurance i.e., Peoples Insurance and Pan Asia go up and down completely randomly.
Pair Corralation between Peoples Insurance and Pan Asia
Assuming the 90 days trading horizon Peoples Insurance is expected to generate 1.84 times less return on investment than Pan Asia. In addition to that, Peoples Insurance is 1.08 times more volatile than Pan Asia Banking. It trades about 0.06 of its total potential returns per unit of risk. Pan Asia Banking is currently generating about 0.12 per unit of volatility. If you would invest 1,910 in Pan Asia Banking on September 24, 2024 and sell it today you would earn a total of 1,080 from holding Pan Asia Banking or generate 56.54% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Peoples Insurance PLC vs. Pan Asia Banking
Performance |
Timeline |
Peoples Insurance PLC |
Pan Asia Banking |
Peoples Insurance and Pan Asia Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Peoples Insurance and Pan Asia
The main advantage of trading using opposite Peoples Insurance and Pan Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peoples Insurance position performs unexpectedly, Pan Asia 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 Pan Asia will offset losses from the drop in Pan Asia's long position.Peoples Insurance vs. HNB Finance | Peoples Insurance vs. Prime Lands Residencies | Peoples Insurance vs. Jat Holdings PLC | Peoples Insurance vs. Lanka Credit and |
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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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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