Correlation Between Hagerty and Aeye
Can any of the company-specific risk be diversified away by investing in both Hagerty and Aeye 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 Hagerty and Aeye into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hagerty and Aeye Inc, you can compare the effects of market volatilities on Hagerty and Aeye 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 Hagerty with a short position of Aeye. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hagerty and Aeye.
Diversification Opportunities for Hagerty and Aeye
Very good diversification
The 3 months correlation between Hagerty and Aeye is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Hagerty and Aeye Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aeye Inc and Hagerty 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 Hagerty are associated (or correlated) with Aeye. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aeye Inc has no effect on the direction of Hagerty i.e., Hagerty and Aeye go up and down completely randomly.
Pair Corralation between Hagerty and Aeye
Given the investment horizon of 90 days Hagerty is expected to under-perform the Aeye. But the stock apears to be less risky and, when comparing its historical volatility, Hagerty is 4.41 times less risky than Aeye. The stock trades about -0.01 of its potential returns per unit of risk. The Aeye Inc is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 121.00 in Aeye Inc on September 13, 2024 and sell it today you would lose (2.00) from holding Aeye Inc or give up 1.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hagerty vs. Aeye Inc
Performance |
| Timeline |
| Hagerty |
| Aeye Inc |
Hagerty and Aeye Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hagerty and Aeye
The main advantage of trading using opposite Hagerty and Aeye positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hagerty position performs unexpectedly, Aeye 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 Aeye will offset losses from the drop in Aeye's long position.| Hagerty vs. Selective Insurance Group | Hagerty vs. Kemper | Hagerty vs. Donegal Group B | Hagerty vs. Argo Group International |
| Aeye vs. Innoviz Technologies | Aeye vs. Luminar Technologies | Aeye vs. Aeva Technologies | Aeye vs. Quantumscape Corp |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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