Correlation Between Interlife General and Performance Technologies

Can any of the company-specific risk be diversified away by investing in both Interlife General and Performance Technologies at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Interlife General and Performance Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Interlife General Insurance and Performance Technologies SA, you can compare the effects of market volatilities on Interlife General and Performance Technologies 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 Interlife General with a short position of Performance Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Interlife General and Performance Technologies.

Diversification Opportunities for Interlife General and Performance Technologies

-0.26

Correlation Coefficient

Interlife General  Performance Technologies

Very good diversification

The 3 months correlation between Interlife and Performance is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Interlife General Insurance and Performance Technologies SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Performance Technologies and Interlife General 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 Interlife General Insurance are associated (or correlated) with Performance Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Performance Technologies has no effect on the direction of Interlife General i.e., Interlife General and Performance Technologies go up and down completely randomly.

Pair Corralation between Interlife General and Performance Technologies

Assuming the 90 days trading horizon Interlife General is expected to generate 19.47 times less return on investment than Performance Technologies. But when comparing it to its historical volatility, Interlife General Insurance is 1.36 times less risky than Performance Technologies. It trades about 0.01 of its potential returns per unit of risk. Performance Technologies SA is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  587.00  in Performance Technologies SA on May 15, 2025 and sell it today you would earn a total of  63.00  from holding Performance Technologies SA or generate 10.73% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Interlife General Insurance  vs.  Performance Technologies SA

Interlife General

Risk-Adjusted Performance

Weakest

Over the last 90 days Interlife General Insurance has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Interlife General is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Performance Technologies

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Performance Technologies SA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Performance Technologies may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Interlife General and Performance Technologies

The main advantage of trading using opposite Interlife General and Performance Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Interlife General position performs unexpectedly, Performance Technologies 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 Performance Technologies will offset losses from the drop in Performance Technologies' long position.

The idea behind Interlife General Insurance and Performance Technologies SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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.