Correlation Between Cabot and United Insurance
Can any of the company-specific risk be diversified away by investing in both Cabot and United 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 Cabot and United Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cabot and United Insurance Holdings, you can compare the effects of market volatilities on Cabot and United 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 Cabot with a short position of United Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cabot and United Insurance.
Diversification Opportunities for Cabot and United Insurance
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cabot and United is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cabot and United Insurance Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Insurance Holdings and Cabot 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 Cabot are associated (or correlated) with United Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Insurance Holdings has no effect on the direction of Cabot i.e., Cabot and United Insurance go up and down completely randomly.
Pair Corralation between Cabot and United Insurance
If you would invest 0.00 in Cabot on October 11, 2024 and sell it today you would earn a total of 0.00 from holding Cabot or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 5.88% |
| Values | Daily Returns |
Cabot vs. United Insurance Holdings
Performance |
| Timeline |
| Cabot |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| United Insurance Holdings |
Cabot and United Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cabot and United Insurance
The main advantage of trading using opposite Cabot and United Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cabot position performs unexpectedly, United 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 United Insurance will offset losses from the drop in United Insurance's long position.| Cabot vs. QBE Insurance Group | Cabot vs. Insurance Australia Group | Cabot vs. FUYO GENERAL LEASE | Cabot vs. SBI Insurance Group |
| United Insurance vs. Austevoll Seafood ASA | United Insurance vs. RCI Hospitality Holdings | United Insurance vs. Wenzhou Kangning Hospital | United Insurance vs. COFCO Joycome Foods |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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