Correlation Between NETGEAR and Assurant
Can any of the company-specific risk be diversified away by investing in both NETGEAR and Assurant 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 NETGEAR and Assurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NETGEAR and Assurant, you can compare the effects of market volatilities on NETGEAR and Assurant 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 NETGEAR with a short position of Assurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of NETGEAR and Assurant.
Diversification Opportunities for NETGEAR and Assurant
Very good diversification
The 3 months correlation between NETGEAR and Assurant is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding NETGEAR and Assurant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assurant and NETGEAR 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 NETGEAR are associated (or correlated) with Assurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Assurant has no effect on the direction of NETGEAR i.e., NETGEAR and Assurant go up and down completely randomly.
Pair Corralation between NETGEAR and Assurant
Given the investment horizon of 90 days NETGEAR is expected to under-perform the Assurant. In addition to that, NETGEAR is 2.07 times more volatile than Assurant. It trades about -0.08 of its total potential returns per unit of risk. Assurant is currently generating about -0.08 per unit of volatility. If you would invest 21,244 in Assurant on December 3, 2024 and sell it today you would lose (455.00) from holding Assurant or give up 2.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
NETGEAR vs. Assurant
Performance |
| Timeline |
| NETGEAR |
| Assurant |
NETGEAR and Assurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NETGEAR and Assurant
The main advantage of trading using opposite NETGEAR and Assurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NETGEAR position performs unexpectedly, Assurant 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 Assurant will offset losses from the drop in Assurant's long position.| NETGEAR vs. KVH Industries | NETGEAR vs. Ituran Location and | NETGEAR vs. Aviat Networks | NETGEAR vs. Mynaric AG ADR |
| Assurant vs. Assured Guaranty | Assurant vs. Ambac Financial Group | Assurant vs. AMERISAFE | Assurant vs. Enact Holdings |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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