Correlation Between Donegal Group and FedNat Holding
Can any of the company-specific risk be diversified away by investing in both Donegal Group and FedNat Holding 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 Donegal Group and FedNat Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Donegal Group B and FedNat Holding, you can compare the effects of market volatilities on Donegal Group and FedNat Holding 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 Donegal Group with a short position of FedNat Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Donegal Group and FedNat Holding.
Diversification Opportunities for Donegal Group and FedNat Holding
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Donegal and FedNat is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Donegal Group B and FedNat Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FedNat Holding and Donegal Group 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 Donegal Group B are associated (or correlated) with FedNat Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FedNat Holding has no effect on the direction of Donegal Group i.e., Donegal Group and FedNat Holding go up and down completely randomly.
Pair Corralation between Donegal Group and FedNat Holding
If you would invest 1,469 in Donegal Group B on August 29, 2024 and sell it today you would earn a total of 21.00 from holding Donegal Group B or generate 1.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Donegal Group B vs. FedNat Holding
Performance |
| Timeline |
| Donegal Group B |
| FedNat Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Donegal Group and FedNat Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Donegal Group and FedNat Holding
The main advantage of trading using opposite Donegal Group and FedNat Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Donegal Group position performs unexpectedly, FedNat Holding 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 FedNat Holding will offset losses from the drop in FedNat Holding's long position.| Donegal Group vs. Horace Mann Educators | Donegal Group vs. United Fire Group | Donegal Group vs. Donegal Group A | Donegal Group vs. Global Indemnity PLC |
| FedNat Holding vs. Aspen Insurance Holdings | FedNat Holding vs. Yuexiu Transport Infrastructure | FedNat Holding vs. Palomar Holdings | FedNat Holding vs. Barrick Gold Corp |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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