Correlation Between National Storage and Zurich Insurance
Can any of the company-specific risk be diversified away by investing in both National Storage and Zurich Insurance 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 National Storage and Zurich Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Storage Affiliates and Zurich Insurance Group, you can compare the effects of market volatilities on National Storage and Zurich 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 National Storage with a short position of Zurich Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Storage and Zurich Insurance.
Diversification Opportunities for National Storage and Zurich Insurance
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between National and Zurich is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding National Storage Affiliates and Zurich Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zurich Insurance and National Storage 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 National Storage Affiliates are associated (or correlated) with Zurich Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zurich Insurance has no effect on the direction of National Storage i.e., National Storage and Zurich Insurance go up and down completely randomly.
Pair Corralation between National Storage and Zurich Insurance
Assuming the 90 days horizon National Storage is expected to generate 1.43 times less return on investment than Zurich Insurance. In addition to that, National Storage is 1.04 times more volatile than Zurich Insurance Group. It trades about 0.08 of its total potential returns per unit of risk. Zurich Insurance Group is currently generating about 0.12 per unit of volatility. If you would invest 2,740 in Zurich Insurance Group on August 25, 2024 and sell it today you would earn a total of 140.00 from holding Zurich Insurance Group or generate 5.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Storage Affiliates vs. Zurich Insurance Group
Performance |
| Timeline |
| National Storage Aff |
| Zurich Insurance |
National Storage and Zurich Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Storage and Zurich Insurance
The main advantage of trading using opposite National Storage and Zurich Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Storage position performs unexpectedly, Zurich 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 Zurich Insurance will offset losses from the drop in Zurich Insurance's long position.| National Storage vs. Superior Plus Corp | National Storage vs. Origin Agritech | National Storage vs. Identiv | National Storage vs. INTUITIVE SURGICAL |
| Zurich Insurance vs. Perseus Mining Limited | Zurich Insurance vs. INDOFOOD AGRI RES | Zurich Insurance vs. Performance Food Group | Zurich Insurance vs. TYSON FOODS A |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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