Correlation Between Maiden Holdings and ServiceNow
Can any of the company-specific risk be diversified away by investing in both Maiden Holdings and ServiceNow 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 Maiden Holdings and ServiceNow into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maiden Holdings and ServiceNow, you can compare the effects of market volatilities on Maiden Holdings and ServiceNow 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 Maiden Holdings with a short position of ServiceNow. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maiden Holdings and ServiceNow.
Diversification Opportunities for Maiden Holdings and ServiceNow
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Maiden and ServiceNow is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Maiden Holdings and ServiceNow in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ServiceNow and Maiden 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 Maiden Holdings are associated (or correlated) with ServiceNow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ServiceNow has no effect on the direction of Maiden Holdings i.e., Maiden Holdings and ServiceNow go up and down completely randomly.
Pair Corralation between Maiden Holdings and ServiceNow
Given the investment horizon of 90 days Maiden Holdings is expected to generate 6.22 times less return on investment than ServiceNow. But when comparing it to its historical volatility, Maiden Holdings is 1.26 times less risky than ServiceNow. It trades about 0.02 of its potential returns per unit of risk. ServiceNow is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 68,768 in ServiceNow on September 2, 2024 and sell it today you would earn a total of 36,176 from holding ServiceNow or generate 52.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.98% |
| Values | Daily Returns |
Maiden Holdings vs. ServiceNow
Performance |
| Timeline |
| Maiden Holdings |
| ServiceNow |
Maiden Holdings and ServiceNow Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maiden Holdings and ServiceNow
The main advantage of trading using opposite Maiden Holdings and ServiceNow positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maiden Holdings position performs unexpectedly, ServiceNow 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 ServiceNow will offset losses from the drop in ServiceNow's long position.| Maiden Holdings vs. Maiden Holdings North | Maiden Holdings vs. Reinsurance Group of | Maiden Holdings vs. Entergy Arkansas LLC | Maiden Holdings vs. Entergy New Orleans |
| ServiceNow vs. Datadog | ServiceNow vs. Gitlab Inc | ServiceNow vs. Atlassian Corp Plc | ServiceNow vs. HubSpot |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |