Correlation Between Siriuspoint and Employers Holdings
Can any of the company-specific risk be diversified away by investing in both Siriuspoint and Employers Holdings 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 Employers Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siriuspoint and Employers Holdings, you can compare the effects of market volatilities on Siriuspoint and Employers Holdings 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 Employers Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siriuspoint and Employers Holdings.
Diversification Opportunities for Siriuspoint and Employers Holdings
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Siriuspoint and Employers is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Siriuspoint and Employers Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Employers Holdings 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 Employers Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Employers Holdings has no effect on the direction of Siriuspoint i.e., Siriuspoint and Employers Holdings go up and down completely randomly.
Pair Corralation between Siriuspoint and Employers Holdings
Given the investment horizon of 90 days Siriuspoint is expected to generate 1.65 times more return on investment than Employers Holdings. However, Siriuspoint is 1.65 times more volatile than Employers Holdings. It trades about 0.32 of its potential returns per unit of risk. Employers Holdings is currently generating about -0.21 per unit of risk. If you would invest 1,432 in Siriuspoint on September 12, 2024 and sell it today you would earn a total of 116.00 from holding Siriuspoint or generate 8.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siriuspoint vs. Employers Holdings
Performance |
| Timeline |
| Siriuspoint |
| Employers Holdings |
Siriuspoint and Employers Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siriuspoint and Employers Holdings
The main advantage of trading using opposite Siriuspoint and Employers Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siriuspoint position performs unexpectedly, Employers Holdings 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 Employers Holdings will offset losses from the drop in Employers Holdings' long position.| Siriuspoint vs. Maiden Holdings | Siriuspoint vs. Reinsurance Group of | Siriuspoint vs. Oxbridge Re Holdings | Siriuspoint vs. Greenlight Capital Re |
| Employers Holdings vs. First American | Employers Holdings vs. Assurant | Employers Holdings vs. NMI Holdings | Employers Holdings vs. MGIC Investment 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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