Correlation Between Positive Physicians and MBIA
Can any of the company-specific risk be diversified away by investing in both Positive Physicians and MBIA 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 Positive Physicians and MBIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Positive Physicians Holdings and MBIA Inc, you can compare the effects of market volatilities on Positive Physicians and MBIA 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 Positive Physicians with a short position of MBIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Positive Physicians and MBIA.
Diversification Opportunities for Positive Physicians and MBIA
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Positive and MBIA is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Positive Physicians Holdings and MBIA Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MBIA Inc and Positive Physicians 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 Positive Physicians Holdings are associated (or correlated) with MBIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MBIA Inc has no effect on the direction of Positive Physicians i.e., Positive Physicians and MBIA go up and down completely randomly.
Pair Corralation between Positive Physicians and MBIA
If you would invest 378.00 in MBIA Inc on August 27, 2024 and sell it today you would earn a total of 310.00 from holding MBIA Inc or generate 82.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Positive Physicians Holdings vs. MBIA Inc
Performance |
| Timeline |
| Positive Physicians |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MBIA Inc |
Positive Physicians and MBIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Positive Physicians and MBIA
The main advantage of trading using opposite Positive Physicians and MBIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Positive Physicians position performs unexpectedly, MBIA 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 MBIA will offset losses from the drop in MBIA's long position.| Positive Physicians vs. Ambac Financial Group | Positive Physicians vs. AMERISAFE | Positive Physicians vs. Assured Guaranty | Positive Physicians vs. Essent Group |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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