Correlation Between Jadestone Energy and Zurich Insurance
Can any of the company-specific risk be diversified away by investing in both Jadestone Energy and Zurich 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 Jadestone Energy and Zurich Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jadestone Energy and Zurich Insurance Group, you can compare the effects of market volatilities on Jadestone Energy and Zurich 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 Jadestone Energy with a short position of Zurich Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jadestone Energy and Zurich Insurance.
Diversification Opportunities for Jadestone Energy and Zurich Insurance
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jadestone and Zurich is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Jadestone Energy and Zurich Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zurich Insurance and Jadestone Energy 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 Jadestone Energy are associated (or correlated) with Zurich Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zurich Insurance has no effect on the direction of Jadestone Energy i.e., Jadestone Energy and Zurich Insurance go up and down completely randomly.
Pair Corralation between Jadestone Energy and Zurich Insurance
Assuming the 90 days trading horizon Jadestone Energy is expected to generate 1.89 times more return on investment than Zurich Insurance. However, Jadestone Energy is 1.89 times more volatile than Zurich Insurance Group. It trades about 0.32 of its potential returns per unit of risk. Zurich Insurance Group is currently generating about -0.02 per unit of risk. If you would invest 2,420 in Jadestone Energy on October 24, 2024 and sell it today you would earn a total of 240.00 from holding Jadestone Energy or generate 9.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jadestone Energy vs. Zurich Insurance Group
Performance |
| Timeline |
| Jadestone Energy |
| Zurich Insurance |
Jadestone Energy and Zurich Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jadestone Energy and Zurich Insurance
The main advantage of trading using opposite Jadestone Energy and Zurich Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jadestone Energy position performs unexpectedly, Zurich 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 Zurich Insurance will offset losses from the drop in Zurich Insurance's long position.| Jadestone Energy vs. Zoom Video Communications | Jadestone Energy vs. Enbridge | Jadestone Energy vs. Endo International PLC | Jadestone Energy vs. Argo Group Limited |
| Zurich Insurance vs. United Utilities Group | Zurich Insurance vs. Gaztransport et Technigaz | Zurich Insurance vs. MoneysupermarketCom Group PLC | Zurich Insurance vs. Hochschild Mining plc |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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