Correlation Between Israel Acquisitions and QBE Insurance
Can any of the company-specific risk be diversified away by investing in both Israel Acquisitions and QBE 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 Israel Acquisitions and QBE Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Israel Acquisitions Corp and QBE Insurance Group, you can compare the effects of market volatilities on Israel Acquisitions and QBE 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 Israel Acquisitions with a short position of QBE Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Israel Acquisitions and QBE Insurance.
Diversification Opportunities for Israel Acquisitions and QBE Insurance
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Israel and QBE is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Israel Acquisitions Corp and QBE Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QBE Insurance Group and Israel Acquisitions 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 Israel Acquisitions Corp are associated (or correlated) with QBE Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QBE Insurance Group has no effect on the direction of Israel Acquisitions i.e., Israel Acquisitions and QBE Insurance go up and down completely randomly.
Pair Corralation between Israel Acquisitions and QBE Insurance
Assuming the 90 days horizon Israel Acquisitions is expected to generate 1.13 times less return on investment than QBE Insurance. But when comparing it to its historical volatility, Israel Acquisitions Corp is 1.36 times less risky than QBE Insurance. It trades about 0.03 of its potential returns per unit of risk. QBE Insurance Group is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,170 in QBE Insurance Group on September 13, 2024 and sell it today you would earn a total of 31.00 from holding QBE Insurance Group or generate 2.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Israel Acquisitions Corp vs. QBE Insurance Group
Performance |
| Timeline |
| Israel Acquisitions Corp |
| QBE Insurance Group |
Israel Acquisitions and QBE Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Israel Acquisitions and QBE Insurance
The main advantage of trading using opposite Israel Acquisitions and QBE Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Israel Acquisitions position performs unexpectedly, QBE 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 QBE Insurance will offset losses from the drop in QBE Insurance's long position.| Israel Acquisitions vs. Centessa Pharmaceuticals PLC | Israel Acquisitions vs. Sligro Food Group | Israel Acquisitions vs. Sellas Life Sciences | Israel Acquisitions vs. Marfrig Global Foods |
| QBE Insurance vs. Root Inc | QBE Insurance vs. Bank of America | QBE Insurance vs. Aerovate Therapeutics | QBE Insurance vs. SoundHound AI |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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