Correlation Between Siriuspoint and Cincinnati Financial
Can any of the company-specific risk be diversified away by investing in both Siriuspoint and Cincinnati Financial 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 Cincinnati Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siriuspoint and Cincinnati Financial, you can compare the effects of market volatilities on Siriuspoint and Cincinnati Financial 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 Cincinnati Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siriuspoint and Cincinnati Financial.
Diversification Opportunities for Siriuspoint and Cincinnati Financial
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Siriuspoint and Cincinnati is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Siriuspoint and Cincinnati Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cincinnati Financial 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 Cincinnati Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cincinnati Financial has no effect on the direction of Siriuspoint i.e., Siriuspoint and Cincinnati Financial go up and down completely randomly.
Pair Corralation between Siriuspoint and Cincinnati Financial
Given the investment horizon of 90 days Siriuspoint is expected to generate 1.29 times more return on investment than Cincinnati Financial. However, Siriuspoint is 1.29 times more volatile than Cincinnati Financial. It trades about 0.1 of its potential returns per unit of risk. Cincinnati Financial is currently generating about 0.06 per unit of risk. If you would invest 667.00 in Siriuspoint on August 23, 2024 and sell it today you would earn a total of 870.00 from holding Siriuspoint or generate 130.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siriuspoint vs. Cincinnati Financial
Performance |
| Timeline |
| Siriuspoint |
| Cincinnati Financial |
Siriuspoint and Cincinnati Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siriuspoint and Cincinnati Financial
The main advantage of trading using opposite Siriuspoint and Cincinnati Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siriuspoint position performs unexpectedly, Cincinnati Financial 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 Cincinnati Financial will offset losses from the drop in Cincinnati Financial's long position.| Siriuspoint vs. Maiden Holdings | Siriuspoint vs. Reinsurance Group of | Siriuspoint vs. Oxbridge Re Holdings | Siriuspoint vs. Greenlight Capital Re |
| Cincinnati Financial vs. Small Cap Core | Cincinnati Financial vs. FitLife Brands, Common | Cincinnati Financial vs. Mutual Of America | Cincinnati Financial vs. Gfl Environmental Holdings |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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