Correlation Between United Insurance and Genertec Universal
Can any of the company-specific risk be diversified away by investing in both United Insurance and Genertec Universal 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 United Insurance and Genertec Universal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Insurance Holdings and Genertec Universal Medical, you can compare the effects of market volatilities on United Insurance and Genertec Universal 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 United Insurance with a short position of Genertec Universal. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Insurance and Genertec Universal.
Diversification Opportunities for United Insurance and Genertec Universal
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between United and Genertec is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding United Insurance Holdings and Genertec Universal Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genertec Universal and United 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 United Insurance Holdings are associated (or correlated) with Genertec Universal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genertec Universal has no effect on the direction of United Insurance i.e., United Insurance and Genertec Universal go up and down completely randomly.
Pair Corralation between United Insurance and Genertec Universal
Assuming the 90 days horizon United Insurance Holdings is expected to under-perform the Genertec Universal. But the stock apears to be less risky and, when comparing its historical volatility, United Insurance Holdings is 1.23 times less risky than Genertec Universal. The stock trades about -0.17 of its potential returns per unit of risk. The Genertec Universal Medical is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 56.00 in Genertec Universal Medical on October 11, 2024 and sell it today you would earn a total of 1.00 from holding Genertec Universal Medical or generate 1.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
United Insurance Holdings vs. Genertec Universal Medical
Performance |
| Timeline |
| United Insurance Holdings |
| Genertec Universal |
United Insurance and Genertec Universal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Insurance and Genertec Universal
The main advantage of trading using opposite United Insurance and Genertec Universal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Insurance position performs unexpectedly, Genertec Universal 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 Genertec Universal will offset losses from the drop in Genertec Universal's long position.| United Insurance vs. Austevoll Seafood ASA | United Insurance vs. RCI Hospitality Holdings | United Insurance vs. Wenzhou Kangning Hospital | United Insurance vs. COFCO Joycome Foods |
| Genertec Universal vs. Webster Financial | Genertec Universal vs. United Insurance Holdings | Genertec Universal vs. Commonwealth Bank of | Genertec Universal vs. Gaming and Leisure |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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