Correlation Between Ecclesiastical Insurance and Moonpig Group
Can any of the company-specific risk be diversified away by investing in both Ecclesiastical Insurance and Moonpig Group 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 Ecclesiastical Insurance and Moonpig Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecclesiastical Insurance Office and Moonpig Group PLC, you can compare the effects of market volatilities on Ecclesiastical Insurance and Moonpig Group 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 Ecclesiastical Insurance with a short position of Moonpig Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecclesiastical Insurance and Moonpig Group.
Diversification Opportunities for Ecclesiastical Insurance and Moonpig Group
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ecclesiastical and Moonpig is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Ecclesiastical Insurance Offic and Moonpig Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moonpig Group PLC and Ecclesiastical Insurance 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 Ecclesiastical Insurance Office are associated (or correlated) with Moonpig Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moonpig Group PLC has no effect on the direction of Ecclesiastical Insurance i.e., Ecclesiastical Insurance and Moonpig Group go up and down completely randomly.
Pair Corralation between Ecclesiastical Insurance and Moonpig Group
Assuming the 90 days trading horizon Ecclesiastical Insurance Office is expected to generate 0.44 times more return on investment than Moonpig Group. However, Ecclesiastical Insurance Office is 2.26 times less risky than Moonpig Group. It trades about 0.03 of its potential returns per unit of risk. Moonpig Group PLC is currently generating about -0.25 per unit of risk. If you would invest 13,050 in Ecclesiastical Insurance Office on October 12, 2024 and sell it today you would earn a total of 50.00 from holding Ecclesiastical Insurance Office or generate 0.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ecclesiastical Insurance Offic vs. Moonpig Group PLC
Performance |
| Timeline |
| Ecclesiastical Insurance |
| Moonpig Group PLC |
Ecclesiastical Insurance and Moonpig Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecclesiastical Insurance and Moonpig Group
The main advantage of trading using opposite Ecclesiastical Insurance and Moonpig Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecclesiastical Insurance position performs unexpectedly, Moonpig Group 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 Moonpig Group will offset losses from the drop in Moonpig Group's long position.| Ecclesiastical Insurance vs. Vitec Software Group | Ecclesiastical Insurance vs. Trellus Health plc | Ecclesiastical Insurance vs. Bytes Technology | Ecclesiastical Insurance vs. Inspiration Healthcare Group |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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