Correlation Between SIEM OFFSHORE and Reinsurance Group
Can any of the company-specific risk be diversified away by investing in both SIEM OFFSHORE and Reinsurance Group 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 SIEM OFFSHORE and Reinsurance Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SIEM OFFSHORE NEW and Reinsurance Group of, you can compare the effects of market volatilities on SIEM OFFSHORE and Reinsurance Group 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 SIEM OFFSHORE with a short position of Reinsurance Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIEM OFFSHORE and Reinsurance Group.
Diversification Opportunities for SIEM OFFSHORE and Reinsurance Group
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between SIEM and Reinsurance is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding SIEM OFFSHORE NEW and Reinsurance Group of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reinsurance Group and SIEM OFFSHORE 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 SIEM OFFSHORE NEW are associated (or correlated) with Reinsurance Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reinsurance Group has no effect on the direction of SIEM OFFSHORE i.e., SIEM OFFSHORE and Reinsurance Group go up and down completely randomly.
Pair Corralation between SIEM OFFSHORE and Reinsurance Group
Assuming the 90 days trading horizon SIEM OFFSHORE NEW is expected to generate 2.38 times more return on investment than Reinsurance Group. However, SIEM OFFSHORE is 2.38 times more volatile than Reinsurance Group of. It trades about 0.03 of its potential returns per unit of risk. Reinsurance Group of is currently generating about -0.2 per unit of risk. If you would invest 219.00 in SIEM OFFSHORE NEW on September 13, 2024 and sell it today you would earn a total of 3.00 from holding SIEM OFFSHORE NEW or generate 1.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SIEM OFFSHORE NEW vs. Reinsurance Group of
Performance |
| Timeline |
| SIEM OFFSHORE NEW |
| Reinsurance Group |
SIEM OFFSHORE and Reinsurance Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SIEM OFFSHORE and Reinsurance Group
The main advantage of trading using opposite SIEM OFFSHORE and Reinsurance Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SIEM OFFSHORE position performs unexpectedly, Reinsurance Group 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 Reinsurance Group will offset losses from the drop in Reinsurance Group's long position.| SIEM OFFSHORE vs. TC Energy | SIEM OFFSHORE vs. Pembina Pipeline Corp | SIEM OFFSHORE vs. Superior Plus Corp | SIEM OFFSHORE vs. SIVERS SEMICONDUCTORS AB |
| Reinsurance Group vs. MUENCHRUECKUNSADR 110 | Reinsurance Group vs. China Reinsurance | Reinsurance Group vs. Superior Plus Corp | Reinsurance Group vs. SIVERS SEMICONDUCTORS AB |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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