Correlation Between Direct Line and INTERSHOP Communications
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By analyzing existing cross correlation between Direct Line Insurance and INTERSHOP Communications Aktiengesellschaft, you can compare the effects of market volatilities on Direct Line and INTERSHOP Communications 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 Direct Line with a short position of INTERSHOP Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Direct Line and INTERSHOP Communications.
Diversification Opportunities for Direct Line and INTERSHOP Communications
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Direct and INTERSHOP is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Direct Line Insurance and INTERSHOP Communications Aktie in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTERSHOP Communications and Direct Line 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 Direct Line Insurance are associated (or correlated) with INTERSHOP Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTERSHOP Communications has no effect on the direction of Direct Line i.e., Direct Line and INTERSHOP Communications go up and down completely randomly.
Pair Corralation between Direct Line and INTERSHOP Communications
Assuming the 90 days trading horizon Direct Line Insurance is expected to generate 1.55 times more return on investment than INTERSHOP Communications. However, Direct Line is 1.55 times more volatile than INTERSHOP Communications Aktiengesellschaft. It trades about 0.05 of its potential returns per unit of risk. INTERSHOP Communications Aktiengesellschaft is currently generating about -0.02 per unit of risk. If you would invest 241.00 in Direct Line Insurance on September 3, 2024 and sell it today you would earn a total of 39.00 from holding Direct Line Insurance or generate 16.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Direct Line Insurance vs. INTERSHOP Communications Aktie
Performance |
| Timeline |
| Direct Line Insurance |
| INTERSHOP Communications |
Direct Line and INTERSHOP Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Direct Line and INTERSHOP Communications
The main advantage of trading using opposite Direct Line and INTERSHOP Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Direct Line position performs unexpectedly, INTERSHOP Communications 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 INTERSHOP Communications will offset losses from the drop in INTERSHOP Communications' long position.| Direct Line vs. Allianz SE | Direct Line vs. Superior Plus Corp | Direct Line vs. NMI Holdings | Direct Line vs. Origin Agritech |
| INTERSHOP Communications vs. Neinor Homes SA | INTERSHOP Communications vs. STRAYER EDUCATION | INTERSHOP Communications vs. Aedas Homes SA | INTERSHOP Communications vs. Corporate Office Properties |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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