Correlation Between AGRICULTBK HADR/25 and Selective Insurance
Can any of the company-specific risk be diversified away by investing in both AGRICULTBK HADR/25 and Selective Insurance 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 AGRICULTBK HADR/25 and Selective Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AGRICULTBK HADR25 YC and Selective Insurance Group, you can compare the effects of market volatilities on AGRICULTBK HADR/25 and Selective Insurance 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 AGRICULTBK HADR/25 with a short position of Selective Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of AGRICULTBK HADR/25 and Selective Insurance.
Diversification Opportunities for AGRICULTBK HADR/25 and Selective Insurance
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AGRICULTBK and Selective is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding AGRICULTBK HADR25 YC and Selective Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Selective Insurance and AGRICULTBK HADR/25 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 AGRICULTBK HADR25 YC are associated (or correlated) with Selective Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Selective Insurance has no effect on the direction of AGRICULTBK HADR/25 i.e., AGRICULTBK HADR/25 and Selective Insurance go up and down completely randomly.
Pair Corralation between AGRICULTBK HADR/25 and Selective Insurance
Assuming the 90 days trading horizon AGRICULTBK HADR25 YC is expected to generate 1.25 times more return on investment than Selective Insurance. However, AGRICULTBK HADR/25 is 1.25 times more volatile than Selective Insurance Group. It trades about 0.07 of its potential returns per unit of risk. Selective Insurance Group is currently generating about -0.01 per unit of risk. If you would invest 637.00 in AGRICULTBK HADR25 YC on November 5, 2024 and sell it today you would earn a total of 643.00 from holding AGRICULTBK HADR25 YC or generate 100.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AGRICULTBK HADR25 YC vs. Selective Insurance Group
Performance |
| Timeline |
| AGRICULTBK HADR/25 |
| Selective Insurance |
AGRICULTBK HADR/25 and Selective Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AGRICULTBK HADR/25 and Selective Insurance
The main advantage of trading using opposite AGRICULTBK HADR/25 and Selective Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AGRICULTBK HADR/25 position performs unexpectedly, Selective Insurance 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 Selective Insurance will offset losses from the drop in Selective Insurance's long position.| AGRICULTBK HADR/25 vs. Charter Communications | AGRICULTBK HADR/25 vs. Computershare Limited | AGRICULTBK HADR/25 vs. Singapore Telecommunications Limited | AGRICULTBK HADR/25 vs. OAKTRSPECLENDNEW |
| Selective Insurance vs. Air Lease | Selective Insurance vs. Global Ship Lease | Selective Insurance vs. WILLIS LEASE FIN | Selective Insurance vs. GigaMedia |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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