Correlation Between Everest Group and Swiss Re
Can any of the company-specific risk be diversified away by investing in both Everest Group and Swiss Re 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 Everest Group and Swiss Re into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Everest Group and Swiss Re AG, you can compare the effects of market volatilities on Everest Group and Swiss Re 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 Everest Group with a short position of Swiss Re. Check out your portfolio center. Please also check ongoing floating volatility patterns of Everest Group and Swiss Re.
Diversification Opportunities for Everest Group and Swiss Re
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Everest and Swiss is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Everest Group and Swiss Re AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swiss Re AG and Everest 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 Everest Group are associated (or correlated) with Swiss Re. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swiss Re AG has no effect on the direction of Everest Group i.e., Everest Group and Swiss Re go up and down completely randomly.
Pair Corralation between Everest Group and Swiss Re
Assuming the 90 days horizon Everest Group is expected to under-perform the Swiss Re. But the stock apears to be less risky and, when comparing its historical volatility, Everest Group is 2.6 times less risky than Swiss Re. The stock trades about -0.45 of its potential returns per unit of risk. The Swiss Re AG is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 3,400 in Swiss Re AG on September 23, 2024 and sell it today you would earn a total of 20.00 from holding Swiss Re AG or generate 0.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Everest Group vs. Swiss Re AG
Performance |
| Timeline |
| Everest Group |
| Swiss Re AG |
Everest Group and Swiss Re Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Everest Group and Swiss Re
The main advantage of trading using opposite Everest Group and Swiss Re positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Everest Group position performs unexpectedly, Swiss Re 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 Swiss Re will offset losses from the drop in Swiss Re's long position.| Everest Group vs. MUENCHRUECKUNSADR 110 | Everest Group vs. Swiss Re AG | Everest Group vs. HANNRUECKVSE ADR 12ON | Everest Group vs. Reinsurance Group of |
| Swiss Re vs. MUENCHRUECKUNSADR 110 | Swiss Re vs. HANNRUECKVSE ADR 12ON | Swiss Re vs. Everest Group | Swiss Re vs. Reinsurance Group of |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios |