Correlation Between Selective Insurance and HEXINDO ADIPERKASA
Can any of the company-specific risk be diversified away by investing in both Selective Insurance and HEXINDO ADIPERKASA 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 Selective Insurance and HEXINDO ADIPERKASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Selective Insurance Group and HEXINDO ADIPERKASA, you can compare the effects of market volatilities on Selective Insurance and HEXINDO ADIPERKASA 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 Selective Insurance with a short position of HEXINDO ADIPERKASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Selective Insurance and HEXINDO ADIPERKASA.
Diversification Opportunities for Selective Insurance and HEXINDO ADIPERKASA
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Selective and HEXINDO is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Selective Insurance Group and HEXINDO ADIPERKASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HEXINDO ADIPERKASA and Selective 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 Selective Insurance Group are associated (or correlated) with HEXINDO ADIPERKASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HEXINDO ADIPERKASA has no effect on the direction of Selective Insurance i.e., Selective Insurance and HEXINDO ADIPERKASA go up and down completely randomly.
Pair Corralation between Selective Insurance and HEXINDO ADIPERKASA
Assuming the 90 days horizon Selective Insurance is expected to generate 1.2 times less return on investment than HEXINDO ADIPERKASA. But when comparing it to its historical volatility, Selective Insurance Group is 2.04 times less risky than HEXINDO ADIPERKASA. It trades about 0.02 of its potential returns per unit of risk. HEXINDO ADIPERKASA is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 29.00 in HEXINDO ADIPERKASA on September 12, 2024 and sell it today you would lose (3.00) from holding HEXINDO ADIPERKASA or give up 10.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Selective Insurance Group vs. HEXINDO ADIPERKASA
Performance |
| Timeline |
| Selective Insurance |
| HEXINDO ADIPERKASA |
Selective Insurance and HEXINDO ADIPERKASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Selective Insurance and HEXINDO ADIPERKASA
The main advantage of trading using opposite Selective Insurance and HEXINDO ADIPERKASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Selective Insurance position performs unexpectedly, HEXINDO ADIPERKASA 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 HEXINDO ADIPERKASA will offset losses from the drop in HEXINDO ADIPERKASA's long position.| Selective Insurance vs. QBE Insurance Group | Selective Insurance vs. Insurance Australia Group | Selective Insurance vs. Superior Plus Corp | Selective Insurance vs. SIVERS SEMICONDUCTORS AB |
| HEXINDO ADIPERKASA vs. Apple Inc | HEXINDO ADIPERKASA vs. Apple Inc | HEXINDO ADIPERKASA vs. Apple Inc | HEXINDO ADIPERKASA vs. Apple Inc |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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