Correlation Between ICICI Lombard and Nippon Life
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By analyzing existing cross correlation between ICICI Lombard General and Nippon Life India, you can compare the effects of market volatilities on ICICI Lombard and Nippon Life 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 ICICI Lombard with a short position of Nippon Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICICI Lombard and Nippon Life.
Diversification Opportunities for ICICI Lombard and Nippon Life
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ICICI and Nippon is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding ICICI Lombard General and Nippon Life India in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nippon Life India and ICICI Lombard 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 ICICI Lombard General are associated (or correlated) with Nippon Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nippon Life India has no effect on the direction of ICICI Lombard i.e., ICICI Lombard and Nippon Life go up and down completely randomly.
Pair Corralation between ICICI Lombard and Nippon Life
Assuming the 90 days trading horizon ICICI Lombard is expected to generate 5.64 times less return on investment than Nippon Life. But when comparing it to its historical volatility, ICICI Lombard General is 1.49 times less risky than Nippon Life. It trades about 0.06 of its potential returns per unit of risk. Nippon Life India is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 63,223 in Nippon Life India on April 25, 2025 and sell it today you would earn a total of 21,372 from holding Nippon Life India or generate 33.8% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
ICICI Lombard General vs. Nippon Life India
Performance |
Timeline |
ICICI Lombard General |
Nippon Life India |
ICICI Lombard and Nippon Life Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ICICI Lombard and Nippon Life
The main advantage of trading using opposite ICICI Lombard and Nippon Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICICI Lombard position performs unexpectedly, Nippon Life 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 Nippon Life will offset losses from the drop in Nippon Life's long position.ICICI Lombard vs. Touchwood Entertainment Limited | ICICI Lombard vs. Zee Entertainment Enterprises | ICICI Lombard vs. Pritish Nandy Communications | ICICI Lombard vs. Infomedia Press Limited |
Nippon Life vs. Indo Rama Synthetics | Nippon Life vs. JGCHEMICALS LIMITED | Nippon Life vs. Sudarshan Chemical Industries | Nippon Life vs. Fineotex Chemical Limited |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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