Correlation Between Assurant and Gap,
Can any of the company-specific risk be diversified away by investing in both Assurant and Gap, 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 Gap, into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Assurant and The Gap,, you can compare the effects of market volatilities on Assurant and Gap, 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 Gap,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Assurant and Gap,.
Diversification Opportunities for Assurant and Gap,
Very weak diversification
The 3 months correlation between Assurant and Gap, is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Assurant and The Gap, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gap, 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 Gap,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gap, has no effect on the direction of Assurant i.e., Assurant and Gap, go up and down completely randomly.
Pair Corralation between Assurant and Gap,
Considering the 90-day investment horizon Assurant is expected to generate 0.55 times more return on investment than Gap,. However, Assurant is 1.82 times less risky than Gap,. It trades about 0.2 of its potential returns per unit of risk. The Gap, is currently generating about 0.09 per unit of risk. If you would invest 19,886 in Assurant on August 29, 2024 and sell it today you would earn a total of 2,808 from holding Assurant or generate 14.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Assurant vs. The Gap,
Performance |
| Timeline |
| Assurant |
| Gap, |
Assurant and Gap, Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Assurant and Gap,
The main advantage of trading using opposite Assurant and Gap, positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Assurant position performs unexpectedly, Gap, 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 Gap, will offset losses from the drop in Gap,'s long position.The idea behind Assurant and The Gap, pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Gap, vs. Sphere Entertainment Co | Gap, vs. Rumble Inc | Gap, vs. FactSet Research Systems | Gap, vs. Asure Software |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |