Correlation Between Assurant and Chemours
Can any of the company-specific risk be diversified away by investing in both Assurant and Chemours 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 Assurant and Chemours into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Assurant and Chemours Co, you can compare the effects of market volatilities on Assurant and Chemours 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 Assurant with a short position of Chemours. Check out your portfolio center. Please also check ongoing floating volatility patterns of Assurant and Chemours.
Diversification Opportunities for Assurant and Chemours
Poor diversification
The 3 months correlation between Assurant and Chemours is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Assurant and Chemours Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chemours and Assurant 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 Assurant are associated (or correlated) with Chemours. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chemours has no effect on the direction of Assurant i.e., Assurant and Chemours go up and down completely randomly.
Pair Corralation between Assurant and Chemours
Considering the 90-day investment horizon Assurant is expected to generate 0.43 times more return on investment than Chemours. However, Assurant is 2.35 times less risky than Chemours. It trades about 0.09 of its potential returns per unit of risk. Chemours Co is currently generating about -0.06 per unit of risk. If you would invest 17,431 in Assurant on September 20, 2024 and sell it today you would earn a total of 3,333 from holding Assurant or generate 19.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Assurant vs. Chemours Co
Performance |
| Timeline |
| Assurant |
| Chemours |
Assurant and Chemours Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Assurant and Chemours
The main advantage of trading using opposite Assurant and Chemours positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Assurant position performs unexpectedly, Chemours 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 Chemours will offset losses from the drop in Chemours' long position.| Assurant vs. Assured Guaranty | Assurant vs. Ambac Financial Group | Assurant vs. AMERISAFE | Assurant vs. Enact Holdings |
| Chemours vs. Olin Corporation | Chemours vs. Cabot | Chemours vs. Kronos Worldwide | Chemours vs. LyondellBasell Industries NV |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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