Correlation Between Renaissancere Holdings and Hamilton Insurance
Can any of the company-specific risk be diversified away by investing in both Renaissancere Holdings and Hamilton 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 Renaissancere Holdings and Hamilton Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Renaissancere Holdings and Hamilton Insurance Group,, you can compare the effects of market volatilities on Renaissancere Holdings and Hamilton 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 Renaissancere Holdings with a short position of Hamilton Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Renaissancere Holdings and Hamilton Insurance.
Diversification Opportunities for Renaissancere Holdings and Hamilton Insurance
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Renaissancere and Hamilton is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Renaissancere Holdings and Hamilton Insurance Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Insurance Group, and Renaissancere 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 Renaissancere Holdings are associated (or correlated) with Hamilton Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Insurance Group, has no effect on the direction of Renaissancere Holdings i.e., Renaissancere Holdings and Hamilton Insurance go up and down completely randomly.
Pair Corralation between Renaissancere Holdings and Hamilton Insurance
Considering the 90-day investment horizon Renaissancere Holdings is expected to generate 1.07 times less return on investment than Hamilton Insurance. But when comparing it to its historical volatility, Renaissancere Holdings is 1.23 times less risky than Hamilton Insurance. It trades about 0.06 of its potential returns per unit of risk. Hamilton Insurance Group, is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,500 in Hamilton Insurance Group, on August 30, 2024 and sell it today you would earn a total of 401.00 from holding Hamilton Insurance Group, or generate 26.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 53.54% |
| Values | Daily Returns |
Renaissancere Holdings vs. Hamilton Insurance Group,
Performance |
| Timeline |
| Renaissancere Holdings |
| Hamilton Insurance Group, |
Renaissancere Holdings and Hamilton Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Renaissancere Holdings and Hamilton Insurance
The main advantage of trading using opposite Renaissancere Holdings and Hamilton Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Renaissancere Holdings position performs unexpectedly, Hamilton 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 Hamilton Insurance will offset losses from the drop in Hamilton Insurance's long position.| Renaissancere Holdings vs. Reinsurance Group of | Renaissancere Holdings vs. Greenlight Capital Re | Renaissancere Holdings vs. Siriuspoint | Renaissancere Holdings vs. SCOR PK |
| Hamilton Insurance vs. Lucid Group | Hamilton Insurance vs. Visteon Corp | Hamilton Insurance vs. HF Sinclair Corp | Hamilton Insurance vs. AerSale Corp |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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