Correlation Between PNC Financial and Zurich Insurance
Can any of the company-specific risk be diversified away by investing in both PNC Financial and Zurich 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 PNC Financial and Zurich Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PNC Financial Services and Zurich Insurance Group, you can compare the effects of market volatilities on PNC Financial and Zurich 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 PNC Financial with a short position of Zurich Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of PNC Financial and Zurich Insurance.
Diversification Opportunities for PNC Financial and Zurich Insurance
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PNC and Zurich is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding PNC Financial Services and Zurich Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zurich Insurance and PNC Financial 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 PNC Financial Services are associated (or correlated) with Zurich Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zurich Insurance has no effect on the direction of PNC Financial i.e., PNC Financial and Zurich Insurance go up and down completely randomly.
Pair Corralation between PNC Financial and Zurich Insurance
Assuming the 90 days trading horizon PNC Financial Services is expected to generate 0.67 times more return on investment than Zurich Insurance. However, PNC Financial Services is 1.49 times less risky than Zurich Insurance. It trades about 0.09 of its potential returns per unit of risk. Zurich Insurance Group is currently generating about 0.04 per unit of risk. If you would invest 18,740 in PNC Financial Services on November 7, 2024 and sell it today you would earn a total of 460.00 from holding PNC Financial Services or generate 2.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 91.3% |
| Values | Daily Returns |
PNC Financial Services vs. Zurich Insurance Group
Performance |
| Timeline |
| PNC Financial Services |
| Zurich Insurance |
PNC Financial and Zurich Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PNC Financial and Zurich Insurance
The main advantage of trading using opposite PNC Financial and Zurich Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PNC Financial position performs unexpectedly, Zurich 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 Zurich Insurance will offset losses from the drop in Zurich Insurance's long position.| PNC Financial vs. Apple Inc | PNC Financial vs. Apple Inc | PNC Financial vs. Apple Inc | PNC Financial vs. Apple Inc |
| Zurich Insurance vs. SPARTAN STORES | Zurich Insurance vs. FIREWEED METALS P | Zurich Insurance vs. SOLSTAD OFFSHORE NK | Zurich Insurance vs. COSTCO WHOLESALE CDR |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |