Correlation Between Insurance Australia and KSB SE
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By analyzing existing cross correlation between Insurance Australia Group and KSB SE Co, you can compare the effects of market volatilities on Insurance Australia and KSB SE 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 Insurance Australia with a short position of KSB SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Insurance Australia and KSB SE.
Diversification Opportunities for Insurance Australia and KSB SE
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Insurance and KSB is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Insurance Australia Group and KSB SE Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KSB SE and Insurance Australia 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 Insurance Australia Group are associated (or correlated) with KSB SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KSB SE has no effect on the direction of Insurance Australia i.e., Insurance Australia and KSB SE go up and down completely randomly.
Pair Corralation between Insurance Australia and KSB SE
Assuming the 90 days horizon Insurance Australia Group is expected to generate 2.64 times more return on investment than KSB SE. However, Insurance Australia is 2.64 times more volatile than KSB SE Co. It trades about 0.14 of its potential returns per unit of risk. KSB SE Co is currently generating about -0.03 per unit of risk. If you would invest 474.00 in Insurance Australia Group on September 13, 2024 and sell it today you would earn a total of 31.00 from holding Insurance Australia Group or generate 6.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Insurance Australia Group vs. KSB SE Co
Performance |
| Timeline |
| Insurance Australia |
| KSB SE |
Insurance Australia and KSB SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Insurance Australia and KSB SE
The main advantage of trading using opposite Insurance Australia and KSB SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Insurance Australia position performs unexpectedly, KSB SE 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 KSB SE will offset losses from the drop in KSB SE's long position.| Insurance Australia vs. Superior Plus Corp | Insurance Australia vs. SIVERS SEMICONDUCTORS AB | Insurance Australia vs. CHINA HUARONG ENERHD 50 | Insurance Australia vs. NORDIC HALIBUT AS |
| KSB SE vs. TYSON FOODS A | KSB SE vs. NorAm Drilling AS | KSB SE vs. Major Drilling Group | KSB SE vs. SENECA FOODS A |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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