Correlation Between Allianz SE and Enstar Group
Can any of the company-specific risk be diversified away by investing in both Allianz SE and Enstar Group 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 Allianz SE and Enstar Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allianz SE and Enstar Group Limited, you can compare the effects of market volatilities on Allianz SE and Enstar Group 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 Allianz SE with a short position of Enstar Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allianz SE and Enstar Group.
Diversification Opportunities for Allianz SE and Enstar Group
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Allianz and Enstar is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Allianz SE and Enstar Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enstar Group Limited and Allianz SE 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 Allianz SE are associated (or correlated) with Enstar Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enstar Group Limited has no effect on the direction of Allianz SE i.e., Allianz SE and Enstar Group go up and down completely randomly.
Pair Corralation between Allianz SE and Enstar Group
Assuming the 90 days horizon Allianz SE is expected to under-perform the Enstar Group. In addition to that, Allianz SE is 5.53 times more volatile than Enstar Group Limited. It trades about -0.08 of its total potential returns per unit of risk. Enstar Group Limited is currently generating about -0.04 per unit of volatility. If you would invest 32,530 in Enstar Group Limited on August 24, 2024 and sell it today you would lose (79.00) from holding Enstar Group Limited or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Allianz SE vs. Enstar Group Limited
Performance |
| Timeline |
| Allianz SE |
| Enstar Group Limited |
Allianz SE and Enstar Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allianz SE and Enstar Group
The main advantage of trading using opposite Allianz SE and Enstar Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allianz SE position performs unexpectedly, Enstar Group 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 Enstar Group will offset losses from the drop in Enstar Group's long position.| Allianz SE vs. Assicurazioni Generali SpA | Allianz SE vs. ageas SANV | Allianz SE vs. AXA SA | Allianz SE vs. Sampo OYJ |
| Enstar Group vs. Global Indemnity PLC | Enstar Group vs. Erie Indemnity | Enstar Group vs. AMERISAFE | Enstar Group vs. Diamond Hill Investment |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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