Correlation Between B Riley and SiriusPoint
Can any of the company-specific risk be diversified away by investing in both B Riley and SiriusPoint 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 B Riley and SiriusPoint into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between B Riley Financial and SiriusPoint, you can compare the effects of market volatilities on B Riley and SiriusPoint 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 B Riley with a short position of SiriusPoint. Check out your portfolio center. Please also check ongoing floating volatility patterns of B Riley and SiriusPoint.
Diversification Opportunities for B Riley and SiriusPoint
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between RILYT and SiriusPoint is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding B Riley Financial and SiriusPoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SiriusPoint and B Riley 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 B Riley Financial are associated (or correlated) with SiriusPoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SiriusPoint has no effect on the direction of B Riley i.e., B Riley and SiriusPoint go up and down completely randomly.
Pair Corralation between B Riley and SiriusPoint
Assuming the 90 days horizon B Riley Financial is expected to generate 13.44 times more return on investment than SiriusPoint. However, B Riley is 13.44 times more volatile than SiriusPoint. It trades about 0.06 of its potential returns per unit of risk. SiriusPoint is currently generating about 0.17 per unit of risk. If you would invest 1,018 in B Riley Financial on August 28, 2024 and sell it today you would earn a total of 41.00 from holding B Riley Financial or generate 4.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
B Riley Financial vs. SiriusPoint
Performance |
| Timeline |
| B Riley Financial |
| SiriusPoint |
B Riley and SiriusPoint Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with B Riley and SiriusPoint
The main advantage of trading using opposite B Riley and SiriusPoint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if B Riley position performs unexpectedly, SiriusPoint 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 SiriusPoint will offset losses from the drop in SiriusPoint's long position.| B Riley vs. B Riley Financial | B Riley vs. B Riley Financial | B Riley vs. B Riley Financial, | B Riley vs. B Riley Financial |
| SiriusPoint vs. RLJ Lodging Trust | SiriusPoint vs. Argo Group International | SiriusPoint vs. New York Mortgage |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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