Correlation Between Kinsale Capital and Hannon Armstrong
Can any of the company-specific risk be diversified away by investing in both Kinsale Capital and Hannon Armstrong 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 Kinsale Capital and Hannon Armstrong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinsale Capital Group and Hannon Armstrong Sustainable, you can compare the effects of market volatilities on Kinsale Capital and Hannon Armstrong 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 Kinsale Capital with a short position of Hannon Armstrong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinsale Capital and Hannon Armstrong.
Diversification Opportunities for Kinsale Capital and Hannon Armstrong
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kinsale and Hannon is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Kinsale Capital Group and Hannon Armstrong Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hannon Armstrong Sus and Kinsale Capital 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 Kinsale Capital Group are associated (or correlated) with Hannon Armstrong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hannon Armstrong Sus has no effect on the direction of Kinsale Capital i.e., Kinsale Capital and Hannon Armstrong go up and down completely randomly.
Pair Corralation between Kinsale Capital and Hannon Armstrong
Given the investment horizon of 90 days Kinsale Capital Group is expected to generate 0.74 times more return on investment than Hannon Armstrong. However, Kinsale Capital Group is 1.34 times less risky than Hannon Armstrong. It trades about 0.04 of its potential returns per unit of risk. Hannon Armstrong Sustainable is currently generating about 0.02 per unit of risk. If you would invest 30,910 in Kinsale Capital Group on November 27, 2024 and sell it today you would earn a total of 11,806 from holding Kinsale Capital Group or generate 38.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinsale Capital Group vs. Hannon Armstrong Sustainable
Performance |
| Timeline |
| Kinsale Capital Group |
| Hannon Armstrong Sus |
Kinsale Capital and Hannon Armstrong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinsale Capital and Hannon Armstrong
The main advantage of trading using opposite Kinsale Capital and Hannon Armstrong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinsale Capital position performs unexpectedly, Hannon Armstrong 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 Hannon Armstrong will offset losses from the drop in Hannon Armstrong's long position.| Kinsale Capital vs. Selective Insurance Group | Kinsale Capital vs. Horace Mann Educators | Kinsale Capital vs. Kemper | Kinsale Capital vs. ProAssurance |
| Hannon Armstrong vs. Equinix | Hannon Armstrong vs. Crown Castle | Hannon Armstrong vs. American Tower Corp | Hannon Armstrong vs. Iron Mountain Incorporated |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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