Correlation Between Spring Valley and Assurant
Can any of the company-specific risk be diversified away by investing in both Spring Valley and Assurant 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 Spring Valley and Assurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spring Valley Acquisition and Assurant, you can compare the effects of market volatilities on Spring Valley and Assurant 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 Spring Valley with a short position of Assurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spring Valley and Assurant.
Diversification Opportunities for Spring Valley and Assurant
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Spring and Assurant is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Spring Valley Acquisition and Assurant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assurant and Spring Valley 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 Spring Valley Acquisition are associated (or correlated) with Assurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Assurant has no effect on the direction of Spring Valley i.e., Spring Valley and Assurant go up and down completely randomly.
Pair Corralation between Spring Valley and Assurant
Assuming the 90 days horizon Spring Valley Acquisition is expected to generate 68.66 times more return on investment than Assurant. However, Spring Valley is 68.66 times more volatile than Assurant. It trades about 0.08 of its potential returns per unit of risk. Assurant is currently generating about 0.11 per unit of risk. If you would invest 9.45 in Spring Valley Acquisition on September 4, 2024 and sell it today you would lose (2.44) from holding Spring Valley Acquisition or give up 25.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 60.73% |
| Values | Daily Returns |
Spring Valley Acquisition vs. Assurant
Performance |
| Timeline |
| Spring Valley Acquisition |
| Assurant |
Spring Valley and Assurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spring Valley and Assurant
The main advantage of trading using opposite Spring Valley and Assurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spring Valley position performs unexpectedly, Assurant 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 Assurant will offset losses from the drop in Assurant's long position.| Spring Valley vs. Merit Medical Systems | Spring Valley vs. Waters | Spring Valley vs. AKITA Drilling | Spring Valley vs. Omni Health |
| Assurant vs. Assured Guaranty | Assurant vs. Ambac Financial Group | Assurant vs. AMERISAFE | Assurant vs. Enact 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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