Correlation Between Old Republic and NeueHealth
Can any of the company-specific risk be diversified away by investing in both Old Republic and NeueHealth 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 Old Republic and NeueHealth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Old Republic International and NeueHealth, you can compare the effects of market volatilities on Old Republic and NeueHealth 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 Old Republic with a short position of NeueHealth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Old Republic and NeueHealth.
Diversification Opportunities for Old Republic and NeueHealth
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Old and NeueHealth is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Old Republic International and NeueHealth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NeueHealth and Old Republic 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 Old Republic International are associated (or correlated) with NeueHealth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NeueHealth has no effect on the direction of Old Republic i.e., Old Republic and NeueHealth go up and down completely randomly.
Pair Corralation between Old Republic and NeueHealth
Considering the 90-day investment horizon Old Republic International is expected to generate 0.18 times more return on investment than NeueHealth. However, Old Republic International is 5.5 times less risky than NeueHealth. It trades about 0.12 of its potential returns per unit of risk. NeueHealth is currently generating about 0.01 per unit of risk. If you would invest 2,783 in Old Republic International on August 24, 2024 and sell it today you would earn a total of 1,072 from holding Old Republic International or generate 38.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Old Republic International vs. NeueHealth
Performance |
| Timeline |
| Old Republic Interna |
| NeueHealth |
Old Republic and NeueHealth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Old Republic and NeueHealth
The main advantage of trading using opposite Old Republic and NeueHealth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Old Republic position performs unexpectedly, NeueHealth 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 NeueHealth will offset losses from the drop in NeueHealth's long position.| Old Republic vs. Axa Equitable Holdings | Old Republic vs. American International Group | Old Republic vs. Arch Capital Group | Old Republic vs. Sun Life Financial |
| NeueHealth vs. Sun Life Financial | NeueHealth vs. Artisan Partners Asset | NeueHealth vs. Glacier Bancorp | NeueHealth vs. Old Republic International |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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