Correlation Between SiriusPoint and Everest
Can any of the company-specific risk be diversified away by investing in both SiriusPoint and Everest 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 SiriusPoint and Everest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SiriusPoint and Everest Group, you can compare the effects of market volatilities on SiriusPoint and Everest 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 SiriusPoint with a short position of Everest. Check out your portfolio center. Please also check ongoing floating volatility patterns of SiriusPoint and Everest.
Diversification Opportunities for SiriusPoint and Everest
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between SiriusPoint and Everest is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding SiriusPoint and Everest Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Everest Group and SiriusPoint 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 SiriusPoint are associated (or correlated) with Everest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Everest Group has no effect on the direction of SiriusPoint i.e., SiriusPoint and Everest go up and down completely randomly.
Pair Corralation between SiriusPoint and Everest
Assuming the 90 days trading horizon SiriusPoint is expected to generate 15.25 times less return on investment than Everest. But when comparing it to its historical volatility, SiriusPoint is 3.81 times less risky than Everest. It trades about 0.03 of its potential returns per unit of risk. Everest Group is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 34,936 in Everest Group on October 20, 2024 and sell it today you would earn a total of 1,281 from holding Everest Group or generate 3.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SiriusPoint vs. Everest Group
Performance |
| Timeline |
| SiriusPoint |
| Everest Group |
SiriusPoint and Everest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SiriusPoint and Everest
The main advantage of trading using opposite SiriusPoint and Everest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SiriusPoint position performs unexpectedly, Everest 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 Everest will offset losses from the drop in Everest's long position.| SiriusPoint vs. RLJ Lodging Trust | SiriusPoint vs. Argo Group International | SiriusPoint vs. New York Mortgage |
| Everest vs. Willamette Valley Vineyards | Everest vs. Vita Coco | Everest vs. Brandywine Realty Trust | Everest vs. Diamond Estates Wines |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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