Correlation Between 00253XAB7 and Cincinnati Financial
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By analyzing existing cross correlation between US00253XAB73 and Cincinnati Financial, you can compare the effects of market volatilities on 00253XAB7 and Cincinnati Financial 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 00253XAB7 with a short position of Cincinnati Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00253XAB7 and Cincinnati Financial.
Diversification Opportunities for 00253XAB7 and Cincinnati Financial
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between 00253XAB7 and Cincinnati is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding US00253XAB73 and Cincinnati Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cincinnati Financial and 00253XAB7 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 US00253XAB73 are associated (or correlated) with Cincinnati Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cincinnati Financial has no effect on the direction of 00253XAB7 i.e., 00253XAB7 and Cincinnati Financial go up and down completely randomly.
Pair Corralation between 00253XAB7 and Cincinnati Financial
Assuming the 90 days trading horizon US00253XAB73 is expected to under-perform the Cincinnati Financial. But the bond apears to be less risky and, when comparing its historical volatility, US00253XAB73 is 1.04 times less risky than Cincinnati Financial. The bond trades about -0.13 of its potential returns per unit of risk. The Cincinnati Financial is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 13,676 in Cincinnati Financial on August 31, 2024 and sell it today you would earn a total of 2,340 from holding Cincinnati Financial or generate 17.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
US00253XAB73 vs. Cincinnati Financial
Performance |
| Timeline |
| US00253XAB73 |
| Cincinnati Financial |
00253XAB7 and Cincinnati Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 00253XAB7 and Cincinnati Financial
The main advantage of trading using opposite 00253XAB7 and Cincinnati Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00253XAB7 position performs unexpectedly, Cincinnati Financial 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 Cincinnati Financial will offset losses from the drop in Cincinnati Financial's long position.| 00253XAB7 vs. Starbucks | 00253XAB7 vs. Tencent Music Entertainment | 00253XAB7 vs. Ryman Hospitality Properties | 00253XAB7 vs. Asure Software |
| Cincinnati Financial vs. Progressive Corp | Cincinnati Financial vs. The Travelers Companies | Cincinnati Financial vs. Chubb | Cincinnati Financial vs. The Allstate |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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