Correlation Between TRADEDOUBLER and HANOVER INSURANCE
Can any of the company-specific risk be diversified away by investing in both TRADEDOUBLER and HANOVER INSURANCE 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 TRADEDOUBLER and HANOVER INSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TRADEDOUBLER AB SK and HANOVER INSURANCE, you can compare the effects of market volatilities on TRADEDOUBLER and HANOVER INSURANCE 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 TRADEDOUBLER with a short position of HANOVER INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRADEDOUBLER and HANOVER INSURANCE.
Diversification Opportunities for TRADEDOUBLER and HANOVER INSURANCE
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between TRADEDOUBLER and HANOVER is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding TRADEDOUBLER AB SK and HANOVER INSURANCE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HANOVER INSURANCE and TRADEDOUBLER 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 TRADEDOUBLER AB SK are associated (or correlated) with HANOVER INSURANCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HANOVER INSURANCE has no effect on the direction of TRADEDOUBLER i.e., TRADEDOUBLER and HANOVER INSURANCE go up and down completely randomly.
Pair Corralation between TRADEDOUBLER and HANOVER INSURANCE
Assuming the 90 days horizon TRADEDOUBLER AB SK is expected to generate 1.88 times more return on investment than HANOVER INSURANCE. However, TRADEDOUBLER is 1.88 times more volatile than HANOVER INSURANCE. It trades about 0.01 of its potential returns per unit of risk. HANOVER INSURANCE is currently generating about -0.04 per unit of risk. If you would invest 27.00 in TRADEDOUBLER AB SK on October 30, 2024 and sell it today you would earn a total of 0.00 from holding TRADEDOUBLER AB SK or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TRADEDOUBLER AB SK vs. HANOVER INSURANCE
Performance |
| Timeline |
| TRADEDOUBLER AB SK |
| HANOVER INSURANCE |
TRADEDOUBLER and HANOVER INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TRADEDOUBLER and HANOVER INSURANCE
The main advantage of trading using opposite TRADEDOUBLER and HANOVER INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TRADEDOUBLER position performs unexpectedly, HANOVER INSURANCE 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 HANOVER INSURANCE will offset losses from the drop in HANOVER INSURANCE's long position.| TRADEDOUBLER vs. United Airlines Holdings | TRADEDOUBLER vs. Siemens Healthineers AG | TRADEDOUBLER vs. China Eastern Airlines | TRADEDOUBLER vs. OPKO HEALTH |
| HANOVER INSURANCE vs. DICKS Sporting Goods | HANOVER INSURANCE vs. SPORTING | HANOVER INSURANCE vs. ANTA SPORTS PRODUCT | HANOVER INSURANCE vs. AIR PRODCHEMICALS |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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