Correlation Between Zurich Insurance and Bloomsbury Publishing
Can any of the company-specific risk be diversified away by investing in both Zurich Insurance and Bloomsbury Publishing 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 Zurich Insurance and Bloomsbury Publishing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zurich Insurance Group and Bloomsbury Publishing Plc, you can compare the effects of market volatilities on Zurich Insurance and Bloomsbury Publishing 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 Zurich Insurance with a short position of Bloomsbury Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zurich Insurance and Bloomsbury Publishing.
Diversification Opportunities for Zurich Insurance and Bloomsbury Publishing
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Zurich and Bloomsbury is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Zurich Insurance Group and Bloomsbury Publishing Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bloomsbury Publishing Plc and Zurich Insurance 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 Zurich Insurance Group are associated (or correlated) with Bloomsbury Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bloomsbury Publishing Plc has no effect on the direction of Zurich Insurance i.e., Zurich Insurance and Bloomsbury Publishing go up and down completely randomly.
Pair Corralation between Zurich Insurance and Bloomsbury Publishing
Assuming the 90 days trading horizon Zurich Insurance is expected to generate 2.23 times less return on investment than Bloomsbury Publishing. But when comparing it to its historical volatility, Zurich Insurance Group is 1.99 times less risky than Bloomsbury Publishing. It trades about 0.05 of its potential returns per unit of risk. Bloomsbury Publishing Plc is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 42,386 in Bloomsbury Publishing Plc on August 28, 2024 and sell it today you would earn a total of 24,814 from holding Bloomsbury Publishing Plc or generate 58.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.58% |
| Values | Daily Returns |
Zurich Insurance Group vs. Bloomsbury Publishing Plc
Performance |
| Timeline |
| Zurich Insurance |
| Bloomsbury Publishing Plc |
Zurich Insurance and Bloomsbury Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zurich Insurance and Bloomsbury Publishing
The main advantage of trading using opposite Zurich Insurance and Bloomsbury Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zurich Insurance position performs unexpectedly, Bloomsbury Publishing 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 Bloomsbury Publishing will offset losses from the drop in Bloomsbury Publishing's long position.| Zurich Insurance vs. Cizzle Biotechnology Holdings | Zurich Insurance vs. X FAB Silicon Foundries | Zurich Insurance vs. Allianz Technology Trust | Zurich Insurance vs. Alfa Financial Software |
| Bloomsbury Publishing vs. Electronic Arts | Bloomsbury Publishing vs. Samsung Electronics Co | Bloomsbury Publishing vs. Ebro Foods | Bloomsbury Publishing vs. LPKF Laser Electronics |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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