Correlation Between HCI and Conifer Holding
Can any of the company-specific risk be diversified away by investing in both HCI and Conifer Holding 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 HCI and Conifer Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HCI Group and Conifer Holding, you can compare the effects of market volatilities on HCI and Conifer Holding 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 HCI with a short position of Conifer Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of HCI and Conifer Holding.
Diversification Opportunities for HCI and Conifer Holding
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between HCI and Conifer is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding HCI Group and Conifer Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Conifer Holding and HCI 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 HCI Group are associated (or correlated) with Conifer Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Conifer Holding has no effect on the direction of HCI i.e., HCI and Conifer Holding go up and down completely randomly.
Pair Corralation between HCI and Conifer Holding
Considering the 90-day investment horizon HCI Group is expected to generate 0.66 times more return on investment than Conifer Holding. However, HCI Group is 1.51 times less risky than Conifer Holding. It trades about 0.0 of its potential returns per unit of risk. Conifer Holding is currently generating about -0.06 per unit of risk. If you would invest 11,669 in HCI Group on August 29, 2024 and sell it today you would lose (68.00) from holding HCI Group or give up 0.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HCI Group vs. Conifer Holding
Performance |
| Timeline |
| HCI Group |
| Conifer Holding |
HCI and Conifer Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HCI and Conifer Holding
The main advantage of trading using opposite HCI and Conifer Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HCI position performs unexpectedly, Conifer Holding 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 Conifer Holding will offset losses from the drop in Conifer Holding's long position.| HCI vs. Universal Insurance Holdings | HCI vs. Kingstone Companies | HCI vs. Horace Mann Educators | HCI vs. Heritage Insurance Hldgs |
| Conifer Holding vs. Wilhelmina | Conifer Holding vs. Unico American | Conifer Holding vs. Creative Media Community | Conifer Holding vs. Kingstone Companies |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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