Correlation Between Selective Insurance and Yakult Honsha
Can any of the company-specific risk be diversified away by investing in both Selective Insurance and Yakult Honsha 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 Yakult Honsha 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 Yakult Honsha CoLtd, you can compare the effects of market volatilities on Selective Insurance and Yakult Honsha 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 Yakult Honsha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Selective Insurance and Yakult Honsha.
Diversification Opportunities for Selective Insurance and Yakult Honsha
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Selective and Yakult is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Selective Insurance Group and Yakult Honsha CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yakult Honsha CoLtd 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 Yakult Honsha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yakult Honsha CoLtd has no effect on the direction of Selective Insurance i.e., Selective Insurance and Yakult Honsha go up and down completely randomly.
Pair Corralation between Selective Insurance and Yakult Honsha
Assuming the 90 days horizon Selective Insurance Group is expected to generate 0.89 times more return on investment than Yakult Honsha. However, Selective Insurance Group is 1.13 times less risky than Yakult Honsha. It trades about 0.02 of its potential returns per unit of risk. Yakult Honsha CoLtd is currently generating about -0.04 per unit of risk. If you would invest 8,253 in Selective Insurance Group on September 14, 2024 and sell it today you would earn a total of 597.00 from holding Selective Insurance Group or generate 7.23% 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. Yakult Honsha CoLtd
Performance |
| Timeline |
| Selective Insurance |
| Yakult Honsha CoLtd |
Selective Insurance and Yakult Honsha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Selective Insurance and Yakult Honsha
The main advantage of trading using opposite Selective Insurance and Yakult Honsha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Selective Insurance position performs unexpectedly, Yakult Honsha 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 Yakult Honsha will offset losses from the drop in Yakult Honsha's long position.| Selective Insurance vs. Insurance Australia Group | Selective Insurance vs. Superior Plus Corp | Selective Insurance vs. SIVERS SEMICONDUCTORS AB | Selective Insurance vs. CHINA HUARONG ENERHD 50 |
| Yakult Honsha vs. Coca Cola FEMSA SAB | Yakult Honsha vs. Coca Cola HBC | Yakult Honsha vs. Coca Cola Consolidated | Yakult Honsha vs. Britvic plc |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Stocks Directory Find actively traded stocks across global markets | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |