Correlation Between Ping An and Cisco Systems
Can any of the company-specific risk be diversified away by investing in both Ping An and Cisco Systems 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 Ping An and Cisco Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ping An Insurance and Cisco Systems, you can compare the effects of market volatilities on Ping An and Cisco Systems 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 Ping An with a short position of Cisco Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Cisco Systems.
Diversification Opportunities for Ping An and Cisco Systems
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ping and Cisco is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and Cisco Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cisco Systems and Ping An 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 Ping An Insurance are associated (or correlated) with Cisco Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cisco Systems has no effect on the direction of Ping An i.e., Ping An and Cisco Systems go up and down completely randomly.
Pair Corralation between Ping An and Cisco Systems
Assuming the 90 days horizon Ping An is expected to generate 21.75 times less return on investment than Cisco Systems. In addition to that, Ping An is 1.69 times more volatile than Cisco Systems. It trades about 0.0 of its total potential returns per unit of risk. Cisco Systems is currently generating about 0.12 per unit of volatility. If you would invest 7,291 in Cisco Systems on August 31, 2025 and sell it today you would earn a total of 316.00 from holding Cisco Systems or generate 4.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ping An Insurance vs. Cisco Systems
Performance |
| Timeline |
| Ping An Insurance |
| Cisco Systems |
Ping An and Cisco Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Cisco Systems
The main advantage of trading using opposite Ping An and Cisco Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, Cisco Systems 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 Cisco Systems will offset losses from the drop in Cisco Systems' long position.| Ping An vs. Malaga Financial | Ping An vs. Naked Wines plc | Ping An vs. First Foods Group | Ping An vs. Brandywine Realty Trust |
| Cisco Systems vs. LATAM Airlines Group | Cisco Systems vs. Sun Country Airlines | Cisco Systems vs. Aegean Airlines SA | Cisco Systems vs. Pebblebrook Hotel Trust |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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