Correlation Between Maiden Holdings and Greenlight Capital
Can any of the company-specific risk be diversified away by investing in both Maiden Holdings and Greenlight Capital 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 Greenlight Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maiden Holdings and Greenlight Capital Re, you can compare the effects of market volatilities on Maiden Holdings and Greenlight Capital 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 Greenlight Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maiden Holdings and Greenlight Capital.
Diversification Opportunities for Maiden Holdings and Greenlight Capital
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Maiden and Greenlight is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Maiden Holdings and Greenlight Capital Re in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Greenlight Capital 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 Greenlight Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Greenlight Capital has no effect on the direction of Maiden Holdings i.e., Maiden Holdings and Greenlight Capital go up and down completely randomly.
Pair Corralation between Maiden Holdings and Greenlight Capital
Given the investment horizon of 90 days Maiden Holdings is expected to under-perform the Greenlight Capital. In addition to that, Maiden Holdings is 6.39 times more volatile than Greenlight Capital Re. It trades about -0.06 of its total potential returns per unit of risk. Greenlight Capital Re is currently generating about -0.07 per unit of volatility. If you would invest 1,465 in Greenlight Capital Re on October 20, 2024 and sell it today you would lose (53.00) from holding Greenlight Capital Re or give up 3.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maiden Holdings vs. Greenlight Capital Re
Performance |
| Timeline |
| Maiden Holdings |
| Greenlight Capital |
Maiden Holdings and Greenlight Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maiden Holdings and Greenlight Capital
The main advantage of trading using opposite Maiden Holdings and Greenlight Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maiden Holdings position performs unexpectedly, Greenlight Capital 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 Greenlight Capital will offset losses from the drop in Greenlight Capital's long position.| Maiden Holdings vs. Siriuspoint | Maiden Holdings vs. Reinsurance Group of | Maiden Holdings vs. Oxbridge Re Holdings | Maiden Holdings vs. Greenlight Capital Re |
| Greenlight Capital vs. Reinsurance Group of | Greenlight Capital vs. Siriuspoint | Greenlight Capital vs. SCOR PK | Greenlight Capital vs. SiriusPoint |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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