Correlation Between MGIC Investment and Aegon NV
Can any of the company-specific risk be diversified away by investing in both MGIC Investment and Aegon NV 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 MGIC Investment and Aegon NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MGIC Investment Corp and Aegon NV PERP, you can compare the effects of market volatilities on MGIC Investment and Aegon NV 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 MGIC Investment with a short position of Aegon NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of MGIC Investment and Aegon NV.
Diversification Opportunities for MGIC Investment and Aegon NV
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MGIC and Aegon is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MGIC Investment Corp and Aegon NV PERP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegon NV PERP and MGIC Investment 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 MGIC Investment Corp are associated (or correlated) with Aegon NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegon NV PERP has no effect on the direction of MGIC Investment i.e., MGIC Investment and Aegon NV go up and down completely randomly.
Pair Corralation between MGIC Investment and Aegon NV
If you would invest (100.00) in Aegon NV PERP on December 4, 2024 and sell it today you would earn a total of 100.00 from holding Aegon NV PERP or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
MGIC Investment Corp vs. Aegon NV PERP
Performance |
| Timeline |
| MGIC Investment Corp |
| Aegon NV PERP |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
MGIC Investment and Aegon NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MGIC Investment and Aegon NV
The main advantage of trading using opposite MGIC Investment and Aegon NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MGIC Investment position performs unexpectedly, Aegon NV 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 Aegon NV will offset losses from the drop in Aegon NV's long position.| MGIC Investment vs. MBIA Inc | MGIC Investment vs. NMI Holdings | MGIC Investment vs. Essent Group | MGIC Investment vs. Assured Guaranty |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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