Correlation Between Tokio Marine and HCI
Can any of the company-specific risk be diversified away by investing in both Tokio Marine and HCI 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 Tokio Marine and HCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tokio Marine Holdings and HCI Group, you can compare the effects of market volatilities on Tokio Marine and HCI 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 Tokio Marine with a short position of HCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tokio Marine and HCI.
Diversification Opportunities for Tokio Marine and HCI
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tokio and HCI is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Tokio Marine Holdings and HCI Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HCI Group and Tokio Marine 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 Tokio Marine Holdings are associated (or correlated) with HCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HCI Group has no effect on the direction of Tokio Marine i.e., Tokio Marine and HCI go up and down completely randomly.
Pair Corralation between Tokio Marine and HCI
If you would invest 2,267 in Tokio Marine Holdings on August 27, 2024 and sell it today you would earn a total of 0.00 from holding Tokio Marine Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.76% |
| Values | Daily Returns |
Tokio Marine Holdings vs. HCI Group
Performance |
| Timeline |
| Tokio Marine Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| HCI Group |
Tokio Marine and HCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tokio Marine and HCI
The main advantage of trading using opposite Tokio Marine and HCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tokio Marine position performs unexpectedly, HCI 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 HCI will offset losses from the drop in HCI's long position.| Tokio Marine vs. American Financial Group | Tokio Marine vs. Aspen Insurance Holdings | Tokio Marine vs. The Allstate | Tokio Marine vs. Aspen Insurance Holdings |
| HCI vs. Universal Insurance Holdings | HCI vs. Kingstone Companies | HCI vs. Horace Mann Educators | HCI vs. Heritage Insurance Hldgs |
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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