Correlation Between Aspen Insurance and FedNat Holding
Can any of the company-specific risk be diversified away by investing in both Aspen Insurance and FedNat Holding 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 Aspen Insurance and FedNat Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aspen Insurance Holdings and FedNat Holding, you can compare the effects of market volatilities on Aspen Insurance and FedNat Holding 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 Aspen Insurance with a short position of FedNat Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aspen Insurance and FedNat Holding.
Diversification Opportunities for Aspen Insurance and FedNat Holding
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Aspen and FedNat is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Aspen Insurance Holdings and FedNat Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FedNat Holding and Aspen 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 Aspen Insurance Holdings are associated (or correlated) with FedNat Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FedNat Holding has no effect on the direction of Aspen Insurance i.e., Aspen Insurance and FedNat Holding go up and down completely randomly.
Pair Corralation between Aspen Insurance and FedNat Holding
If you would invest 2,060 in Aspen Insurance Holdings on September 1, 2024 and sell it today you would earn a total of 148.00 from holding Aspen Insurance Holdings or generate 7.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Aspen Insurance Holdings vs. FedNat Holding
Performance |
| Timeline |
| Aspen Insurance Holdings |
| FedNat Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Aspen Insurance and FedNat Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aspen Insurance and FedNat Holding
The main advantage of trading using opposite Aspen Insurance and FedNat Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aspen Insurance position performs unexpectedly, FedNat Holding 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 FedNat Holding will offset losses from the drop in FedNat Holding's long position.| Aspen Insurance vs. Aspen Insurance Holdings | Aspen Insurance vs. Selective Insurance Group | Aspen Insurance vs. The Allstate | Aspen Insurance vs. AmTrust Financial Services |
| FedNat Holding vs. ArcelorMittal SA ADR | FedNat Holding vs. Sable Offshore Corp | FedNat Holding vs. Mangazeya Mining | FedNat Holding vs. Insteel Industries |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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