Correlation Between WIMFARM SA and Zurich Insurance
Can any of the company-specific risk be diversified away by investing in both WIMFARM SA 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 WIMFARM SA and Zurich Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WIMFARM SA EO and Zurich Insurance Group, you can compare the effects of market volatilities on WIMFARM SA 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 WIMFARM SA with a short position of Zurich Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of WIMFARM SA and Zurich Insurance.
Diversification Opportunities for WIMFARM SA and Zurich Insurance
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between WIMFARM and Zurich is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding WIMFARM SA EO and Zurich Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zurich Insurance and WIMFARM SA 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 WIMFARM SA EO 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 WIMFARM SA i.e., WIMFARM SA and Zurich Insurance go up and down completely randomly.
Pair Corralation between WIMFARM SA and Zurich Insurance
Assuming the 90 days horizon WIMFARM SA EO is expected to under-perform the Zurich Insurance. In addition to that, WIMFARM SA is 2.39 times more volatile than Zurich Insurance Group. It trades about -0.02 of its total potential returns per unit of risk. Zurich Insurance Group is currently generating about 0.07 per unit of volatility. If you would invest 2,091 in Zurich Insurance Group on September 19, 2024 and sell it today you would earn a total of 809.00 from holding Zurich Insurance Group or generate 38.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
WIMFARM SA EO vs. Zurich Insurance Group
Performance |
| Timeline |
| WIMFARM SA EO |
| Zurich Insurance |
WIMFARM SA and Zurich Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WIMFARM SA and Zurich Insurance
The main advantage of trading using opposite WIMFARM SA and Zurich Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WIMFARM SA 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.| WIMFARM SA vs. AB Volvo | WIMFARM SA vs. Daimler Truck Holding | WIMFARM SA vs. Superior Plus Corp | WIMFARM SA vs. SIVERS SEMICONDUCTORS AB |
| Zurich Insurance vs. Superior Plus Corp | Zurich Insurance vs. SIVERS SEMICONDUCTORS AB | Zurich Insurance vs. CHINA HUARONG ENERHD 50 | Zurich Insurance vs. NORDIC HALIBUT AS |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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