Correlation Between Safety Insurance and Xinhua Winshare
Can any of the company-specific risk be diversified away by investing in both Safety Insurance and Xinhua Winshare 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 Safety Insurance and Xinhua Winshare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Safety Insurance Group and Xinhua Winshare Publishing, you can compare the effects of market volatilities on Safety Insurance and Xinhua Winshare 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 Safety Insurance with a short position of Xinhua Winshare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Safety Insurance and Xinhua Winshare.
Diversification Opportunities for Safety Insurance and Xinhua Winshare
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Safety and Xinhua is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Safety Insurance Group and Xinhua Winshare Publishing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinhua Winshare Publ and Safety 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 Safety Insurance Group are associated (or correlated) with Xinhua Winshare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinhua Winshare Publ has no effect on the direction of Safety Insurance i.e., Safety Insurance and Xinhua Winshare go up and down completely randomly.
Pair Corralation between Safety Insurance and Xinhua Winshare
Assuming the 90 days horizon Safety Insurance Group is expected to generate 0.82 times more return on investment than Xinhua Winshare. However, Safety Insurance Group is 1.22 times less risky than Xinhua Winshare. It trades about -0.12 of its potential returns per unit of risk. Xinhua Winshare Publishing is currently generating about -0.22 per unit of risk. If you would invest 7,900 in Safety Insurance Group on November 3, 2024 and sell it today you would lose (400.00) from holding Safety Insurance Group or give up 5.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Safety Insurance Group vs. Xinhua Winshare Publishing
Performance |
| Timeline |
| Safety Insurance |
| Xinhua Winshare Publ |
Safety Insurance and Xinhua Winshare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Safety Insurance and Xinhua Winshare
The main advantage of trading using opposite Safety Insurance and Xinhua Winshare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Safety Insurance position performs unexpectedly, Xinhua Winshare 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 Xinhua Winshare will offset losses from the drop in Xinhua Winshare's long position.| Safety Insurance vs. ALERION CLEANPOWER | Safety Insurance vs. Indutrade AB | Safety Insurance vs. Clean Energy Fuels | Safety Insurance vs. Titan Machinery |
| Xinhua Winshare vs. SBI Insurance Group | Xinhua Winshare vs. REVO INSURANCE SPA | Xinhua Winshare vs. GOLD ROAD RES | Xinhua Winshare vs. Vienna Insurance 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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