Correlation Between Hamilton Insurance and Aspen Insurance
Can any of the company-specific risk be diversified away by investing in both Hamilton Insurance and Aspen Insurance 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 Hamilton Insurance and Aspen Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hamilton Insurance Group, and Aspen Insurance Holdings, you can compare the effects of market volatilities on Hamilton Insurance and Aspen Insurance 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 Hamilton Insurance with a short position of Aspen Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hamilton Insurance and Aspen Insurance.
Diversification Opportunities for Hamilton Insurance and Aspen Insurance
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hamilton and Aspen is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Hamilton Insurance Group, and Aspen Insurance Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aspen Insurance Holdings and Hamilton Insurance 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 Hamilton Insurance Group, are associated (or correlated) with Aspen Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aspen Insurance Holdings has no effect on the direction of Hamilton Insurance i.e., Hamilton Insurance and Aspen Insurance go up and down completely randomly.
Pair Corralation between Hamilton Insurance and Aspen Insurance
Allowing for the 90-day total investment horizon Hamilton Insurance Group, is expected to generate 2.74 times more return on investment than Aspen Insurance. However, Hamilton Insurance is 2.74 times more volatile than Aspen Insurance Holdings. It trades about 0.18 of its potential returns per unit of risk. Aspen Insurance Holdings is currently generating about -0.19 per unit of risk. If you would invest 1,778 in Hamilton Insurance Group, on August 24, 2024 and sell it today you would earn a total of 122.00 from holding Hamilton Insurance Group, or generate 6.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hamilton Insurance Group, vs. Aspen Insurance Holdings
Performance |
| Timeline |
| Hamilton Insurance Group, |
| Aspen Insurance Holdings |
Hamilton Insurance and Aspen Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hamilton Insurance and Aspen Insurance
The main advantage of trading using opposite Hamilton Insurance and Aspen Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hamilton Insurance position performs unexpectedly, Aspen Insurance 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 Aspen Insurance will offset losses from the drop in Aspen Insurance's long position.| Hamilton Insurance vs. Casio Computer Co | Hamilton Insurance vs. BCE Inc | Hamilton Insurance vs. Sabre Corpo | Hamilton Insurance vs. Pinterest |
| Aspen Insurance vs. The Allstate | Aspen Insurance vs. Aspen Insurance Holdings | Aspen Insurance vs. AmTrust Financial Services | Aspen Insurance vs. Argo Group International |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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