Correlation Between United Fire and NORFOLK
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By analyzing existing cross correlation between United Fire Group and NORFOLK SOUTHN P, you can compare the effects of market volatilities on United Fire and NORFOLK 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 United Fire with a short position of NORFOLK. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Fire and NORFOLK.
Diversification Opportunities for United Fire and NORFOLK
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between United and NORFOLK is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding United Fire Group and NORFOLK SOUTHN P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NORFOLK SOUTHN P and United Fire 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 United Fire Group are associated (or correlated) with NORFOLK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NORFOLK SOUTHN P has no effect on the direction of United Fire i.e., United Fire and NORFOLK go up and down completely randomly.
Pair Corralation between United Fire and NORFOLK
Given the investment horizon of 90 days United Fire Group is expected to generate 3.61 times more return on investment than NORFOLK. However, United Fire is 3.61 times more volatile than NORFOLK SOUTHN P. It trades about 0.07 of its potential returns per unit of risk. NORFOLK SOUTHN P is currently generating about 0.01 per unit of risk. If you would invest 2,064 in United Fire Group on September 4, 2024 and sell it today you would earn a total of 1,002 from holding United Fire Group or generate 48.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 65.18% |
| Values | Daily Returns |
United Fire Group vs. NORFOLK SOUTHN P
Performance |
| Timeline |
| United Fire Group |
| NORFOLK SOUTHN P |
United Fire and NORFOLK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Fire and NORFOLK
The main advantage of trading using opposite United Fire and NORFOLK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Fire position performs unexpectedly, NORFOLK 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 NORFOLK will offset losses from the drop in NORFOLK's long position.| United Fire vs. Donegal Group B | United Fire vs. Horace Mann Educators | United Fire vs. Donegal Group A | United Fire vs. Global Indemnity PLC |
| NORFOLK vs. Acumen Pharmaceuticals | NORFOLK vs. Mind Medicine | NORFOLK vs. Tscan Therapeutics | NORFOLK vs. Regeneron Pharmaceuticals |
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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