Correlation Between CNA Financial and WELLS
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By analyzing existing cross correlation between CNA Financial and WELLS FARGO NEW, you can compare the effects of market volatilities on CNA Financial and WELLS 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 CNA Financial with a short position of WELLS. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNA Financial and WELLS.
Diversification Opportunities for CNA Financial and WELLS
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CNA and WELLS is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding CNA Financial and WELLS FARGO NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WELLS FARGO NEW and CNA Financial 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 CNA Financial are associated (or correlated) with WELLS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WELLS FARGO NEW has no effect on the direction of CNA Financial i.e., CNA Financial and WELLS go up and down completely randomly.
Pair Corralation between CNA Financial and WELLS
Considering the 90-day investment horizon CNA Financial is expected to generate 1.47 times more return on investment than WELLS. However, CNA Financial is 1.47 times more volatile than WELLS FARGO NEW. It trades about 0.16 of its potential returns per unit of risk. WELLS FARGO NEW is currently generating about 0.19 per unit of risk. If you would invest 4,752 in CNA Financial on November 9, 2024 and sell it today you would earn a total of 213.00 from holding CNA Financial or generate 4.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
CNA Financial vs. WELLS FARGO NEW
Performance |
| Timeline |
| CNA Financial |
| WELLS FARGO NEW |
CNA Financial and WELLS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNA Financial and WELLS
The main advantage of trading using opposite CNA Financial and WELLS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNA Financial position performs unexpectedly, WELLS 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 WELLS will offset losses from the drop in WELLS's long position.| CNA Financial vs. Great Western Minerals | CNA Financial vs. Enterprise Bancorp | CNA Financial vs. T Rowe Price | CNA Financial vs. Aviat Networks |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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