Correlation Between ICC Holdings and Citizens
Can any of the company-specific risk be diversified away by investing in both ICC Holdings and Citizens 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 ICC Holdings and Citizens into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ICC Holdings and Citizens, you can compare the effects of market volatilities on ICC Holdings and Citizens 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 ICC Holdings with a short position of Citizens. Check out your portfolio center. Please also check ongoing floating volatility patterns of ICC Holdings and Citizens.
Diversification Opportunities for ICC Holdings and Citizens
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ICC and Citizens is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding ICC Holdings and Citizens in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citizens and ICC Holdings 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 ICC Holdings are associated (or correlated) with Citizens. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citizens has no effect on the direction of ICC Holdings i.e., ICC Holdings and Citizens go up and down completely randomly.
Pair Corralation between ICC Holdings and Citizens
Given the investment horizon of 90 days ICC Holdings is expected to generate 1.14 times less return on investment than Citizens. But when comparing it to its historical volatility, ICC Holdings is 1.2 times less risky than Citizens. It trades about 0.1 of its potential returns per unit of risk. Citizens is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 298.00 in Citizens on September 5, 2024 and sell it today you would earn a total of 148.00 from holding Citizens or generate 49.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 93.6% |
| Values | Daily Returns |
ICC Holdings vs. Citizens
Performance |
| Timeline |
| ICC Holdings |
| Citizens |
ICC Holdings and Citizens Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ICC Holdings and Citizens
The main advantage of trading using opposite ICC Holdings and Citizens positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ICC Holdings position performs unexpectedly, Citizens 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 Citizens will offset losses from the drop in Citizens' long position.| ICC Holdings vs. Employers Holdings | ICC Holdings vs. AMERISAFE | ICC Holdings vs. NMI Holdings | ICC Holdings vs. Investors Title |
| Citizens vs. CNO Financial Group | Citizens vs. Brighthouse Financial | Citizens vs. FG Annuities Life | Citizens vs. Prudential Public Limited |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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