Correlation Between Assicurazioni Generali and Enstar Group
Can any of the company-specific risk be diversified away by investing in both Assicurazioni Generali 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 Assicurazioni Generali and Enstar Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Assicurazioni Generali SpA and Enstar Group Limited, you can compare the effects of market volatilities on Assicurazioni Generali 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 Assicurazioni Generali with a short position of Enstar Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Assicurazioni Generali and Enstar Group.
Diversification Opportunities for Assicurazioni Generali and Enstar Group
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Assicurazioni and Enstar is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Assicurazioni Generali SpA 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 Assicurazioni Generali 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 Assicurazioni Generali SpA 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 Assicurazioni Generali i.e., Assicurazioni Generali and Enstar Group go up and down completely randomly.
Pair Corralation between Assicurazioni Generali and Enstar Group
Assuming the 90 days horizon Assicurazioni Generali SpA is expected to generate 1.48 times more return on investment than Enstar Group. However, Assicurazioni Generali is 1.48 times more volatile than Enstar Group Limited. It trades about 0.22 of its potential returns per unit of risk. Enstar Group Limited is currently generating about 0.03 per unit of risk. If you would invest 2,707 in Assicurazioni Generali SpA on August 27, 2024 and sell it today you would earn a total of 51.00 from holding Assicurazioni Generali SpA or generate 1.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Assicurazioni Generali SpA vs. Enstar Group Limited
Performance |
| Timeline |
| Assicurazioni Generali |
| Enstar Group Limited |
Assicurazioni Generali and Enstar Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Assicurazioni Generali and Enstar Group
The main advantage of trading using opposite Assicurazioni Generali and Enstar Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Assicurazioni Generali 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.| Assicurazioni Generali vs. Athene Holding | Assicurazioni Generali vs. Athene Holding | Assicurazioni Generali vs. Arch Capital Group |
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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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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