Correlation Between PICC Property and Universal Insurance
Can any of the company-specific risk be diversified away by investing in both PICC Property and Universal Insurance 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 PICC Property and Universal Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PICC Property and and Universal Insurance Holdings, you can compare the effects of market volatilities on PICC Property and Universal Insurance 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 PICC Property with a short position of Universal Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of PICC Property and Universal Insurance.
Diversification Opportunities for PICC Property and Universal Insurance
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between PICC and Universal is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding PICC Property and and Universal Insurance Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Insurance and PICC Property 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 PICC Property and are associated (or correlated) with Universal Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Insurance has no effect on the direction of PICC Property i.e., PICC Property and Universal Insurance go up and down completely randomly.
Pair Corralation between PICC Property and Universal Insurance
Assuming the 90 days horizon PICC Property is expected to generate 1.13 times less return on investment than Universal Insurance. In addition to that, PICC Property is 1.85 times more volatile than Universal Insurance Holdings. It trades about 0.21 of its total potential returns per unit of risk. Universal Insurance Holdings is currently generating about 0.44 per unit of volatility. If you would invest 1,780 in Universal Insurance Holdings on August 29, 2024 and sell it today you would earn a total of 400.00 from holding Universal Insurance Holdings or generate 22.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
PICC Property and vs. Universal Insurance Holdings
Performance |
| Timeline |
| PICC Property |
| Universal Insurance |
PICC Property and Universal Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PICC Property and Universal Insurance
The main advantage of trading using opposite PICC Property and Universal Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PICC Property position performs unexpectedly, Universal Insurance 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 Universal Insurance will offset losses from the drop in Universal Insurance's long position.| PICC Property vs. COMPUTERSHARE | PICC Property vs. Vastned Retail NV | PICC Property vs. Hemisphere Energy Corp | PICC Property vs. Liberty Broadband |
| Universal Insurance vs. PICC Property and | Universal Insurance vs. QBE Insurance Group | Universal Insurance vs. Superior Plus Corp | Universal Insurance vs. SIVERS SEMICONDUCTORS AB |
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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