diversifiable risk of combining Askari Bank and Adamjee Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Askari Bank and Adamjee Insurance, you can compare the effects of market volatilities on Askari Bank and Adamjee Insurance 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 Askari Bank with a short position of Adamjee Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Askari Bank and Adamjee Insurance.
Diversification Opportunities for Askari Bank and Adamjee Insurance
Pair Corralation between Askari Bank and Adamjee Insurance
Askari Bank vs. Adamjee Insurance
Askari Bank and Adamjee Insurance Volatility Contrast
Pair Trading with Askari Bank and Adamjee InsuranceThe main advantage of trading using opposite Askari Bank and Adamjee Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Askari Bank position performs unexpectedly, Adamjee Insurance 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 Adamjee Insurance will offset losses from the drop in Adamjee Insurance's long position. The idea behind Askari Bank and Adamjee Insurance 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.
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..