Correlation Between Asure Software and Selective Insurance
Can any of the company-specific risk be diversified away by investing in both Asure Software and Selective Insurance 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 Asure Software and Selective Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asure Software and Selective Insurance Group, you can compare the effects of market volatilities on Asure Software and Selective Insurance 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 Asure Software with a short position of Selective Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asure Software and Selective Insurance.
Diversification Opportunities for Asure Software and Selective Insurance
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Asure and Selective is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Asure Software and Selective Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selective Insurance and Asure Software 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 Asure Software are associated (or correlated) with Selective Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selective Insurance has no effect on the direction of Asure Software i.e., Asure Software and Selective Insurance go up and down completely randomly.
Pair Corralation between Asure Software and Selective Insurance
Given the investment horizon of 90 days Asure Software is expected to generate 2.88 times more return on investment than Selective Insurance. However, Asure Software is 2.88 times more volatile than Selective Insurance Group. It trades about 0.49 of its potential returns per unit of risk. Selective Insurance Group is currently generating about 0.08 per unit of risk. If you would invest 910.00 in Asure Software on October 24, 2024 and sell it today you would earn a total of 304.00 from holding Asure Software or generate 33.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asure Software vs. Selective Insurance Group
Performance |
| Timeline |
| Asure Software |
| Selective Insurance |
Asure Software and Selective Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asure Software and Selective Insurance
The main advantage of trading using opposite Asure Software and Selective Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asure Software position performs unexpectedly, Selective Insurance 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 Selective Insurance will offset losses from the drop in Selective Insurance's long position.| Asure Software vs. Alkami Technology | Asure Software vs. Blackbaud | Asure Software vs. Enfusion | Asure Software vs. Clearwater Analytics Holdings |
| Selective Insurance vs. Kemper | Selective Insurance vs. Donegal Group B | Selective Insurance vs. Argo Group International | Selective Insurance vs. Global Indemnity PLC |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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