Correlation Between Superior Plus and Swiss Re
Can any of the company-specific risk be diversified away by investing in both Superior Plus and Swiss Re 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 Swiss Re 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 Swiss Re AG, you can compare the effects of market volatilities on Superior Plus and Swiss Re 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 Swiss Re. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and Swiss Re.
Diversification Opportunities for Superior Plus and Swiss Re
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Superior and Swiss is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and Swiss Re AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swiss Re AG 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 Swiss Re. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swiss Re AG has no effect on the direction of Superior Plus i.e., Superior Plus and Swiss Re go up and down completely randomly.
Pair Corralation between Superior Plus and Swiss Re
Assuming the 90 days horizon Superior Plus is expected to generate 1.85 times less return on investment than Swiss Re. In addition to that, Superior Plus is 1.13 times more volatile than Swiss Re AG. It trades about 0.07 of its total potential returns per unit of risk. Swiss Re AG is currently generating about 0.14 per unit of volatility. If you would invest 3,140 in Swiss Re AG on October 11, 2024 and sell it today you would earn a total of 320.00 from holding Swiss Re AG or generate 10.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. Swiss Re AG
Performance |
| Timeline |
| Superior Plus Corp |
| Swiss Re AG |
Superior Plus and Swiss Re Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and Swiss Re
The main advantage of trading using opposite Superior Plus and Swiss Re positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, Swiss Re 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 Swiss Re will offset losses from the drop in Swiss Re's long position.| Superior Plus vs. Urban Outfitters | Superior Plus vs. BII Railway Transportation | Superior Plus vs. Perdoceo Education | Superior Plus vs. G III Apparel Group |
| Swiss Re vs. MUENCHRUECKUNSADR 110 | Swiss Re vs. Reinsurance Group of | Swiss Re vs. China Reinsurance | Swiss Re vs. Superior Plus Corp |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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