Correlation Between Crawford and Selectquote
Can any of the company-specific risk be diversified away by investing in both Crawford and Selectquote 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 Crawford and Selectquote into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crawford Company and Selectquote, you can compare the effects of market volatilities on Crawford and Selectquote 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 Crawford with a short position of Selectquote. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crawford and Selectquote.
Diversification Opportunities for Crawford and Selectquote
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Crawford and Selectquote is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Crawford Company and Selectquote in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selectquote and Crawford 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 Crawford Company are associated (or correlated) with Selectquote. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selectquote has no effect on the direction of Crawford i.e., Crawford and Selectquote go up and down completely randomly.
Pair Corralation between Crawford and Selectquote
Assuming the 90 days horizon Crawford is expected to generate 2.67 times less return on investment than Selectquote. But when comparing it to its historical volatility, Crawford Company is 2.54 times less risky than Selectquote. It trades about 0.07 of its potential returns per unit of risk. Selectquote is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 76.00 in Selectquote on August 28, 2024 and sell it today you would earn a total of 222.00 from holding Selectquote or generate 292.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Crawford Company vs. Selectquote
Performance |
| Timeline |
| Crawford |
| Selectquote |
Crawford and Selectquote Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crawford and Selectquote
The main advantage of trading using opposite Crawford and Selectquote positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crawford position performs unexpectedly, Selectquote 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 Selectquote will offset losses from the drop in Selectquote's long position.| Crawford vs. CorVel Corp | Crawford vs. Erie Indemnity | Crawford vs. Willis Towers Watson | Crawford vs. Huize Holding |
| Selectquote vs. CorVel Corp | Selectquote vs. eHealth | Selectquote vs. Aquagold International | Selectquote vs. Morningstar Unconstrained Allocation |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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