Correlation Between Adamjee Insurance and ITTEFAQ Iron
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By analyzing existing cross correlation between Adamjee Insurance and ITTEFAQ Iron Industries, you can compare the effects of market volatilities on Adamjee Insurance and ITTEFAQ Iron 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 Adamjee Insurance with a short position of ITTEFAQ Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adamjee Insurance and ITTEFAQ Iron.
Diversification Opportunities for Adamjee Insurance and ITTEFAQ Iron
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Adamjee and ITTEFAQ is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Adamjee Insurance and ITTEFAQ Iron Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ITTEFAQ Iron Industries and Adamjee 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 Adamjee Insurance are associated (or correlated) with ITTEFAQ Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ITTEFAQ Iron Industries has no effect on the direction of Adamjee Insurance i.e., Adamjee Insurance and ITTEFAQ Iron go up and down completely randomly.
Pair Corralation between Adamjee Insurance and ITTEFAQ Iron
Assuming the 90 days trading horizon Adamjee Insurance is expected to generate 0.88 times more return on investment than ITTEFAQ Iron. However, Adamjee Insurance is 1.13 times less risky than ITTEFAQ Iron. It trades about 0.22 of its potential returns per unit of risk. ITTEFAQ Iron Industries is currently generating about 0.07 per unit of risk. If you would invest 4,172 in Adamjee Insurance on April 21, 2025 and sell it today you would earn a total of 2,682 from holding Adamjee Insurance or generate 64.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Adamjee Insurance vs. ITTEFAQ Iron Industries
Performance |
Timeline |
Adamjee Insurance |
ITTEFAQ Iron Industries |
Adamjee Insurance and ITTEFAQ Iron Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Adamjee Insurance and ITTEFAQ Iron
The main advantage of trading using opposite Adamjee Insurance and ITTEFAQ Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adamjee Insurance position performs unexpectedly, ITTEFAQ Iron 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 ITTEFAQ Iron will offset losses from the drop in ITTEFAQ Iron's long position.Adamjee Insurance vs. Masood Textile Mills | Adamjee Insurance vs. Fauji Foods | Adamjee Insurance vs. KSB Pumps | Adamjee Insurance vs. Mari Petroleum |
ITTEFAQ Iron vs. Masood Textile Mills | ITTEFAQ Iron vs. Fauji Foods | ITTEFAQ Iron vs. KSB Pumps | ITTEFAQ Iron vs. Mari Petroleum |
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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