Correlation Between Superior Plus and HANOVER INSURANCE
Can any of the company-specific risk be diversified away by investing in both Superior Plus and HANOVER 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 Superior Plus and HANOVER INSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and HANOVER INSURANCE, you can compare the effects of market volatilities on Superior Plus and HANOVER 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 Superior Plus with a short position of HANOVER INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and HANOVER INSURANCE.
Diversification Opportunities for Superior Plus and HANOVER INSURANCE
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Superior and HANOVER is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and HANOVER INSURANCE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HANOVER INSURANCE and Superior Plus 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 Superior Plus Corp are associated (or correlated) with HANOVER INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HANOVER INSURANCE has no effect on the direction of Superior Plus i.e., Superior Plus and HANOVER INSURANCE go up and down completely randomly.
Pair Corralation between Superior Plus and HANOVER INSURANCE
Assuming the 90 days horizon Superior Plus Corp is expected to under-perform the HANOVER INSURANCE. But the stock apears to be less risky and, when comparing its historical volatility, Superior Plus Corp is 1.11 times less risky than HANOVER INSURANCE. The stock trades about -0.16 of its potential returns per unit of risk. The HANOVER INSURANCE is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 14,400 in HANOVER INSURANCE on November 27, 2024 and sell it today you would earn a total of 400.00 from holding HANOVER INSURANCE or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. HANOVER INSURANCE
Performance |
| Timeline |
| Superior Plus Corp |
| HANOVER INSURANCE |
Superior Plus and HANOVER INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and HANOVER INSURANCE
The main advantage of trading using opposite Superior Plus and HANOVER INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, HANOVER 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 HANOVER INSURANCE will offset losses from the drop in HANOVER INSURANCE's long position.| Superior Plus vs. SANOK RUBBER ZY | Superior Plus vs. APPLIED MATERIALS | Superior Plus vs. WILLIS LEASE FIN | Superior Plus vs. FUYO GENERAL LEASE |
| HANOVER INSURANCE vs. SOLSTAD OFFSHORE NK | HANOVER INSURANCE vs. Eidesvik Offshore ASA | HANOVER INSURANCE vs. URBAN OUTFITTERS | HANOVER INSURANCE vs. EIDESVIK OFFSHORE NK |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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