Correlation Between QBE Insurance and AMERICAN
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By analyzing existing cross correlation between QBE Insurance Group and AMERICAN HOMES 4, you can compare the effects of market volatilities on QBE Insurance and AMERICAN 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 QBE Insurance with a short position of AMERICAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of QBE Insurance and AMERICAN.
Diversification Opportunities for QBE Insurance and AMERICAN
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between QBE and AMERICAN is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding QBE Insurance Group and AMERICAN HOMES 4 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMERICAN HOMES 4 and QBE Insurance 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 QBE Insurance Group are associated (or correlated) with AMERICAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMERICAN HOMES 4 has no effect on the direction of QBE Insurance i.e., QBE Insurance and AMERICAN go up and down completely randomly.
Pair Corralation between QBE Insurance and AMERICAN
Assuming the 90 days horizon QBE Insurance Group is expected to generate 3.33 times more return on investment than AMERICAN. However, QBE Insurance is 3.33 times more volatile than AMERICAN HOMES 4. It trades about 0.07 of its potential returns per unit of risk. AMERICAN HOMES 4 is currently generating about 0.02 per unit of risk. If you would invest 904.00 in QBE Insurance Group on September 12, 2024 and sell it today you would earn a total of 318.00 from holding QBE Insurance Group or generate 35.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 71.75% |
| Values | Daily Returns |
QBE Insurance Group vs. AMERICAN HOMES 4
Performance |
| Timeline |
| QBE Insurance Group |
| AMERICAN HOMES 4 |
QBE Insurance and AMERICAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with QBE Insurance and AMERICAN
The main advantage of trading using opposite QBE Insurance and AMERICAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if QBE Insurance position performs unexpectedly, AMERICAN 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 AMERICAN will offset losses from the drop in AMERICAN's long position.| QBE Insurance vs. Root Inc | QBE Insurance vs. Bank of America | QBE Insurance vs. Aerovate Therapeutics | QBE Insurance vs. SoundHound AI |
| AMERICAN vs. ICC Holdings | AMERICAN vs. United Fire Group | AMERICAN vs. QBE Insurance Group | AMERICAN vs. The Hanover Insurance |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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