Correlation Between Strategic Investments and INSURANCE AUST
Can any of the company-specific risk be diversified away by investing in both Strategic Investments and INSURANCE AUST 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 Strategic Investments and INSURANCE AUST into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Strategic Investments AS and INSURANCE AUST GRP, you can compare the effects of market volatilities on Strategic Investments and INSURANCE AUST 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 Strategic Investments with a short position of INSURANCE AUST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strategic Investments and INSURANCE AUST.
Diversification Opportunities for Strategic Investments and INSURANCE AUST
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Strategic and INSURANCE is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Strategic Investments AS and INSURANCE AUST GRP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INSURANCE AUST GRP and Strategic Investments 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 Strategic Investments AS are associated (or correlated) with INSURANCE AUST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INSURANCE AUST GRP has no effect on the direction of Strategic Investments i.e., Strategic Investments and INSURANCE AUST go up and down completely randomly.
Pair Corralation between Strategic Investments and INSURANCE AUST
Assuming the 90 days horizon Strategic Investments AS is expected to generate 3.31 times more return on investment than INSURANCE AUST. However, Strategic Investments is 3.31 times more volatile than INSURANCE AUST GRP. It trades about 0.04 of its potential returns per unit of risk. INSURANCE AUST GRP is currently generating about 0.09 per unit of risk. If you would invest 8.74 in Strategic Investments AS on September 4, 2024 and sell it today you would earn a total of 5.26 from holding Strategic Investments AS or generate 60.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Strategic Investments AS vs. INSURANCE AUST GRP
Performance |
| Timeline |
| Strategic Investments |
| INSURANCE AUST GRP |
Strategic Investments and INSURANCE AUST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strategic Investments and INSURANCE AUST
The main advantage of trading using opposite Strategic Investments and INSURANCE AUST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strategic Investments position performs unexpectedly, INSURANCE AUST 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 INSURANCE AUST will offset losses from the drop in INSURANCE AUST's long position.| Strategic Investments vs. Blackstone Group | Strategic Investments vs. BlackRock | Strategic Investments vs. The Bank of | Strategic Investments vs. Ameriprise Financial |
| INSURANCE AUST vs. Strategic Investments AS | INSURANCE AUST vs. American Eagle Outfitters | INSURANCE AUST vs. Virtus Investment Partners | INSURANCE AUST vs. Aegean Airlines SA |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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