Correlation Between Selective Insurance and Gesundheitswelt Chiemgau
Can any of the company-specific risk be diversified away by investing in both Selective Insurance and Gesundheitswelt Chiemgau 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 Gesundheitswelt Chiemgau 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 Gesundheitswelt Chiemgau AG, you can compare the effects of market volatilities on Selective Insurance and Gesundheitswelt Chiemgau 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 Gesundheitswelt Chiemgau. Check out your portfolio center. Please also check ongoing floating volatility patterns of Selective Insurance and Gesundheitswelt Chiemgau.
Diversification Opportunities for Selective Insurance and Gesundheitswelt Chiemgau
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Selective and Gesundheitswelt is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Selective Insurance Group and Gesundheitswelt Chiemgau AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gesundheitswelt Chiemgau 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 Gesundheitswelt Chiemgau. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gesundheitswelt Chiemgau has no effect on the direction of Selective Insurance i.e., Selective Insurance and Gesundheitswelt Chiemgau go up and down completely randomly.
Pair Corralation between Selective Insurance and Gesundheitswelt Chiemgau
Assuming the 90 days horizon Selective Insurance Group is expected to under-perform the Gesundheitswelt Chiemgau. In addition to that, Selective Insurance is 1.6 times more volatile than Gesundheitswelt Chiemgau AG. It trades about -0.22 of its total potential returns per unit of risk. Gesundheitswelt Chiemgau AG is currently generating about 0.09 per unit of volatility. If you would invest 1,220 in Gesundheitswelt Chiemgau AG on September 13, 2024 and sell it today you would earn a total of 20.00 from holding Gesundheitswelt Chiemgau AG or generate 1.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Selective Insurance Group vs. Gesundheitswelt Chiemgau AG
Performance |
| Timeline |
| Selective Insurance |
| Gesundheitswelt Chiemgau |
Selective Insurance and Gesundheitswelt Chiemgau Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Selective Insurance and Gesundheitswelt Chiemgau
The main advantage of trading using opposite Selective Insurance and Gesundheitswelt Chiemgau positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Selective Insurance position performs unexpectedly, Gesundheitswelt Chiemgau 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 Gesundheitswelt Chiemgau will offset losses from the drop in Gesundheitswelt Chiemgau'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 |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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