Correlation Between Genworth Financial and AstraZeneca PLC
Can any of the company-specific risk be diversified away by investing in both Genworth Financial and AstraZeneca PLC 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 Genworth Financial and AstraZeneca PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genworth Financial and AstraZeneca PLC, you can compare the effects of market volatilities on Genworth Financial and AstraZeneca PLC 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 Genworth Financial with a short position of AstraZeneca PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genworth Financial and AstraZeneca PLC.
Diversification Opportunities for Genworth Financial and AstraZeneca PLC
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Genworth and AstraZeneca is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Genworth Financial and AstraZeneca PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AstraZeneca PLC and Genworth Financial 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 Genworth Financial are associated (or correlated) with AstraZeneca PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AstraZeneca PLC has no effect on the direction of Genworth Financial i.e., Genworth Financial and AstraZeneca PLC go up and down completely randomly.
Pair Corralation between Genworth Financial and AstraZeneca PLC
If you would invest 133,626 in AstraZeneca PLC on November 7, 2024 and sell it today you would earn a total of 10,874 from holding AstraZeneca PLC or generate 8.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Genworth Financial vs. AstraZeneca PLC
Performance |
| Timeline |
| Genworth Financial |
| AstraZeneca PLC |
Genworth Financial and AstraZeneca PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genworth Financial and AstraZeneca PLC
The main advantage of trading using opposite Genworth Financial and AstraZeneca PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genworth Financial position performs unexpectedly, AstraZeneca PLC 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 AstraZeneca PLC will offset losses from the drop in AstraZeneca PLC's long position.| Genworth Financial vs. Taiwan Semiconductor Manufacturing | Genworth Financial vs. Grupo Sports World | Genworth Financial vs. Delta Air Lines | Genworth Financial vs. CVS Health |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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