Correlation Between Greenlight Capital and Swiss Re
Can any of the company-specific risk be diversified away by investing in both Greenlight Capital 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 Greenlight Capital and Swiss Re into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greenlight Capital Re and Swiss Re AG, you can compare the effects of market volatilities on Greenlight Capital 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 Greenlight Capital with a short position of Swiss Re. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenlight Capital and Swiss Re.
Diversification Opportunities for Greenlight Capital and Swiss Re
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Greenlight and Swiss is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Greenlight Capital Re 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 Greenlight Capital 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 Greenlight Capital Re 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 Greenlight Capital i.e., Greenlight Capital and Swiss Re go up and down completely randomly.
Pair Corralation between Greenlight Capital and Swiss Re
Given the investment horizon of 90 days Greenlight Capital is expected to generate 1.75 times less return on investment than Swiss Re. But when comparing it to its historical volatility, Greenlight Capital Re is 2.75 times less risky than Swiss Re. It trades about 0.09 of its potential returns per unit of risk. Swiss Re AG is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 7,886 in Swiss Re AG on August 24, 2024 and sell it today you would earn a total of 6,364 from holding Swiss Re AG or generate 80.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 79.23% |
| Values | Daily Returns |
Greenlight Capital Re vs. Swiss Re AG
Performance |
| Timeline |
| Greenlight Capital |
| Swiss Re AG |
Greenlight Capital and Swiss Re Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greenlight Capital and Swiss Re
The main advantage of trading using opposite Greenlight Capital and Swiss Re positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greenlight Capital 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.| Greenlight Capital vs. Reinsurance Group of | Greenlight Capital vs. Siriuspoint | Greenlight Capital vs. SCOR PK | Greenlight Capital vs. SiriusPoint |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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