Correlation Between Global Indemnity and Great Southern
Can any of the company-specific risk be diversified away by investing in both Global Indemnity and Great Southern 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 Global Indemnity and Great Southern into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Indemnity PLC and Great Southern Bancorp, you can compare the effects of market volatilities on Global Indemnity and Great Southern 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 Global Indemnity with a short position of Great Southern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Indemnity and Great Southern.
Diversification Opportunities for Global Indemnity and Great Southern
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Global and Great is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Global Indemnity PLC and Great Southern Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great Southern Bancorp and Global Indemnity 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 Global Indemnity PLC are associated (or correlated) with Great Southern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great Southern Bancorp has no effect on the direction of Global Indemnity i.e., Global Indemnity and Great Southern go up and down completely randomly.
Pair Corralation between Global Indemnity and Great Southern
Given the investment horizon of 90 days Global Indemnity is expected to generate 89.33 times less return on investment than Great Southern. But when comparing it to its historical volatility, Global Indemnity PLC is 4.56 times less risky than Great Southern. It trades about 0.01 of its potential returns per unit of risk. Great Southern Bancorp is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 5,819 in Great Southern Bancorp on August 24, 2024 and sell it today you would earn a total of 443.00 from holding Great Southern Bancorp or generate 7.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Global Indemnity PLC vs. Great Southern Bancorp
Performance |
| Timeline |
| Global Indemnity PLC |
| Great Southern Bancorp |
Global Indemnity and Great Southern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Indemnity and Great Southern
The main advantage of trading using opposite Global Indemnity and Great Southern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Indemnity position performs unexpectedly, Great Southern 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 Great Southern will offset losses from the drop in Great Southern's long position.| Global Indemnity vs. Selective Insurance Group | Global Indemnity vs. Kemper | Global Indemnity vs. Donegal Group B | Global Indemnity vs. Argo Group International |
| Great Southern vs. First Northwest Bancorp | Great Southern vs. Community West Bancshares | Great Southern vs. First Financial Northwest | Great Southern vs. First Capital |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |