Correlation Between Kingstone Companies and Argo Group
Can any of the company-specific risk be diversified away by investing in both Kingstone Companies and Argo Group 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 Kingstone Companies and Argo Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kingstone Companies and Argo Group International, you can compare the effects of market volatilities on Kingstone Companies and Argo Group 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 Kingstone Companies with a short position of Argo Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingstone Companies and Argo Group.
Diversification Opportunities for Kingstone Companies and Argo Group
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kingstone and Argo is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Kingstone Companies and Argo Group International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argo Group International and Kingstone Companies 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 Kingstone Companies are associated (or correlated) with Argo Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argo Group International has no effect on the direction of Kingstone Companies i.e., Kingstone Companies and Argo Group go up and down completely randomly.
Pair Corralation between Kingstone Companies and Argo Group
Given the investment horizon of 90 days Kingstone Companies is expected to generate 30.3 times more return on investment than Argo Group. However, Kingstone Companies is 30.3 times more volatile than Argo Group International. It trades about 0.16 of its potential returns per unit of risk. Argo Group International is currently generating about 0.2 per unit of risk. If you would invest 1,470 in Kingstone Companies on November 27, 2024 and sell it today you would earn a total of 155.00 from holding Kingstone Companies or generate 10.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kingstone Companies vs. Argo Group International
Performance |
| Timeline |
| Kingstone Companies |
| Argo Group International |
Kingstone Companies and Argo Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingstone Companies and Argo Group
The main advantage of trading using opposite Kingstone Companies and Argo Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingstone Companies position performs unexpectedly, Argo Group 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 Argo Group will offset losses from the drop in Argo Group's long position.| Kingstone Companies vs. HCI Group | Kingstone Companies vs. Universal Insurance Holdings | Kingstone Companies vs. Horace Mann Educators | Kingstone Companies vs. Heritage Insurance Hldgs |
| Argo Group vs. Life Time Group | Argo Group vs. Summit Hotel Properties | Argo Group vs. Hasbro Inc | Argo Group vs. Small Cap Premium |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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