Correlation Between Karachi 100 and Cboe UK
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By analyzing existing cross correlation between Karachi 100 and Cboe UK Consumer, you can compare the effects of market volatilities on Karachi 100 and Cboe UK 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 Karachi 100 with a short position of Cboe UK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Karachi 100 and Cboe UK.
Diversification Opportunities for Karachi 100 and Cboe UK
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Karachi and Cboe is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Karachi 100 and Cboe UK Consumer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cboe UK Consumer and Karachi 100 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 Karachi 100 are associated (or correlated) with Cboe UK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cboe UK Consumer has no effect on the direction of Karachi 100 i.e., Karachi 100 and Cboe UK go up and down completely randomly.
Pair Corralation between Karachi 100 and Cboe UK
Assuming the 90 days trading horizon Karachi 100 is expected to generate 0.88 times more return on investment than Cboe UK. However, Karachi 100 is 1.14 times less risky than Cboe UK. It trades about 0.82 of its potential returns per unit of risk. Cboe UK Consumer is currently generating about -0.14 per unit of risk. If you would invest 6,679,632 in Karachi 100 on January 30, 2024 and sell it today you would earn a total of 594,862 from holding Karachi 100 or generate 8.91% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 85.0% |
Values | Daily Returns |
Karachi 100 vs. Cboe UK Consumer
Performance |
Timeline |
Karachi 100 and Cboe UK Volatility Contrast
Predicted Return Density |
Returns |
Karachi 100
Pair trading matchups for Karachi 100
Cboe UK Consumer
Pair trading matchups for Cboe UK
Pair Trading with Karachi 100 and Cboe UK
The main advantage of trading using opposite Karachi 100 and Cboe UK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Karachi 100 position performs unexpectedly, Cboe UK 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 Cboe UK will offset losses from the drop in Cboe UK's long position.Karachi 100 vs. TPL Insurance | Karachi 100 vs. Nimir Industrial Chemical | Karachi 100 vs. Reliance Insurance Co | Karachi 100 vs. EFU General Insurance |
Cboe UK vs. Tata Steel Limited | Cboe UK vs. Hilton Food Group | Cboe UK vs. Edita Food Industries | Cboe UK vs. Impax Environmental Markets |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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