Correlation Between Zurich Insurance and JLEN Environmental
Can any of the company-specific risk be diversified away by investing in both Zurich Insurance and JLEN Environmental 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 JLEN Environmental 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 JLEN Environmental Assets, you can compare the effects of market volatilities on Zurich Insurance and JLEN Environmental 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 JLEN Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zurich Insurance and JLEN Environmental.
Diversification Opportunities for Zurich Insurance and JLEN Environmental
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Zurich and JLEN is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Zurich Insurance Group and JLEN Environmental Assets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JLEN Environmental Assets 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 JLEN Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JLEN Environmental Assets has no effect on the direction of Zurich Insurance i.e., Zurich Insurance and JLEN Environmental go up and down completely randomly.
Pair Corralation between Zurich Insurance and JLEN Environmental
Assuming the 90 days trading horizon Zurich Insurance Group is expected to generate 0.7 times more return on investment than JLEN Environmental. However, Zurich Insurance Group is 1.42 times less risky than JLEN Environmental. It trades about 0.05 of its potential returns per unit of risk. JLEN Environmental Assets is currently generating about -0.07 per unit of risk. If you would invest 44,441 in Zurich Insurance Group on October 30, 2024 and sell it today you would earn a total of 10,139 from holding Zurich Insurance Group or generate 22.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.4% |
| Values | Daily Returns |
Zurich Insurance Group vs. JLEN Environmental Assets
Performance |
| Timeline |
| Zurich Insurance |
| JLEN Environmental Assets |
Zurich Insurance and JLEN Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zurich Insurance and JLEN Environmental
The main advantage of trading using opposite Zurich Insurance and JLEN Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zurich Insurance position performs unexpectedly, JLEN Environmental 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 JLEN Environmental will offset losses from the drop in JLEN Environmental's long position.| Zurich Insurance vs. CAP LEASE AVIATION | Zurich Insurance vs. United Airlines Holdings | Zurich Insurance vs. MoneysupermarketCom Group PLC | Zurich Insurance vs. Scandinavian Tobacco Group |
| JLEN Environmental vs. Geely Automobile Holdings | JLEN Environmental vs. Flow Traders NV | JLEN Environmental vs. Games Workshop Group | JLEN Environmental vs. Charter Communications Cl |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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