Correlation Between Altus Group and BROOKFIELD REINSURANCE
Can any of the company-specific risk be diversified away by investing in both Altus Group and BROOKFIELD REINSURANCE 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 Altus Group and BROOKFIELD REINSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altus Group Limited and BROOKFIELD REINSURANCE LTD, you can compare the effects of market volatilities on Altus Group and BROOKFIELD REINSURANCE 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 Altus Group with a short position of BROOKFIELD REINSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altus Group and BROOKFIELD REINSURANCE.
Diversification Opportunities for Altus Group and BROOKFIELD REINSURANCE
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Altus and BROOKFIELD is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Altus Group Limited and BROOKFIELD REINSURANCE LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BROOKFIELD REINSURANCE and Altus Group 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 Altus Group Limited are associated (or correlated) with BROOKFIELD REINSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BROOKFIELD REINSURANCE has no effect on the direction of Altus Group i.e., Altus Group and BROOKFIELD REINSURANCE go up and down completely randomly.
Pair Corralation between Altus Group and BROOKFIELD REINSURANCE
If you would invest 5,430 in Altus Group Limited on September 3, 2024 and sell it today you would earn a total of 522.00 from holding Altus Group Limited or generate 9.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 1.56% |
| Values | Daily Returns |
Altus Group Limited vs. BROOKFIELD REINSURANCE LTD
Performance |
| Timeline |
| Altus Group Limited |
| BROOKFIELD REINSURANCE |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Altus Group and BROOKFIELD REINSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altus Group and BROOKFIELD REINSURANCE
The main advantage of trading using opposite Altus Group and BROOKFIELD REINSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altus Group position performs unexpectedly, BROOKFIELD REINSURANCE 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 BROOKFIELD REINSURANCE will offset losses from the drop in BROOKFIELD REINSURANCE's long position.| Altus Group vs. Colliers International Group | Altus Group vs. FirstService Corp | Altus Group vs. Winpak | Altus Group vs. Ritchie Bros Auctioneers |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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