Correlation Between Palomar Holdings and Maiden Holdings
Can any of the company-specific risk be diversified away by investing in both Palomar Holdings and Maiden Holdings 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 Palomar Holdings and Maiden Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Palomar Holdings and Maiden Holdings, you can compare the effects of market volatilities on Palomar Holdings and Maiden Holdings 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 Palomar Holdings with a short position of Maiden Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Palomar Holdings and Maiden Holdings.
Diversification Opportunities for Palomar Holdings and Maiden Holdings
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Palomar and Maiden is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Palomar Holdings and Maiden Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maiden Holdings and Palomar Holdings 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 Palomar Holdings are associated (or correlated) with Maiden Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maiden Holdings has no effect on the direction of Palomar Holdings i.e., Palomar Holdings and Maiden Holdings go up and down completely randomly.
Pair Corralation between Palomar Holdings and Maiden Holdings
Given the investment horizon of 90 days Palomar Holdings is expected to generate 1.13 times less return on investment than Maiden Holdings. But when comparing it to its historical volatility, Palomar Holdings is 1.05 times less risky than Maiden Holdings. It trades about 0.11 of its potential returns per unit of risk. Maiden Holdings is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,451 in Maiden Holdings on November 9, 2024 and sell it today you would earn a total of 76.00 from holding Maiden Holdings or generate 5.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Palomar Holdings vs. Maiden Holdings
Performance |
| Timeline |
| Palomar Holdings |
| Maiden Holdings |
Palomar Holdings and Maiden Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Palomar Holdings and Maiden Holdings
The main advantage of trading using opposite Palomar Holdings and Maiden Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Palomar Holdings position performs unexpectedly, Maiden Holdings 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 Maiden Holdings will offset losses from the drop in Maiden Holdings' long position.| Palomar Holdings vs. Horace Mann Educators | Palomar Holdings vs. Kemper | Palomar Holdings vs. RLI Corp | Palomar Holdings vs. Global Indemnity PLC |
| Maiden Holdings vs. Maiden Holdings North | Maiden Holdings vs. Reinsurance Group of | Maiden Holdings vs. Entergy Arkansas LLC | Maiden Holdings vs. Entergy New Orleans |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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