Correlation Between TFI International and Assurant
Can any of the company-specific risk be diversified away by investing in both TFI International 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 TFI International and Assurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TFI International and Assurant, you can compare the effects of market volatilities on TFI International 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 TFI International with a short position of Assurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of TFI International and Assurant.
Diversification Opportunities for TFI International and Assurant
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between TFI and Assurant is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding TFI International and Assurant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assurant and TFI International 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 TFI International 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 TFI International i.e., TFI International and Assurant go up and down completely randomly.
Pair Corralation between TFI International and Assurant
Given the investment horizon of 90 days TFI International is expected to generate 1.54 times less return on investment than Assurant. In addition to that, TFI International is 1.27 times more volatile than Assurant. It trades about 0.05 of its total potential returns per unit of risk. Assurant is currently generating about 0.1 per unit of volatility. If you would invest 12,110 in Assurant on August 31, 2024 and sell it today you would earn a total of 10,600 from holding Assurant or generate 87.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
TFI International vs. Assurant
Performance |
| Timeline |
| TFI International |
| Assurant |
TFI International and Assurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TFI International and Assurant
The main advantage of trading using opposite TFI International and Assurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TFI International 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.| TFI International vs. Old Dominion Freight | TFI International vs. ArcBest Corp | TFI International vs. Marten Transport | TFI International vs. Werner Enterprises |
| 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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