Correlation Between Bausch and Siriuspoint
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By analyzing existing cross correlation between Bausch Health Companies and Siriuspoint, you can compare the effects of market volatilities on Bausch and Siriuspoint 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 Bausch with a short position of Siriuspoint. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bausch and Siriuspoint.
Diversification Opportunities for Bausch and Siriuspoint
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bausch and Siriuspoint is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Bausch Health Companies and Siriuspoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Siriuspoint and Bausch 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 Bausch Health Companies are associated (or correlated) with Siriuspoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Siriuspoint has no effect on the direction of Bausch i.e., Bausch and Siriuspoint go up and down completely randomly.
Pair Corralation between Bausch and Siriuspoint
Assuming the 90 days trading horizon Bausch Health Companies is expected to generate 43.93 times more return on investment than Siriuspoint. However, Bausch is 43.93 times more volatile than Siriuspoint. It trades about 0.08 of its potential returns per unit of risk. Siriuspoint is currently generating about 0.09 per unit of risk. If you would invest 4,825 in Bausch Health Companies on October 9, 2024 and sell it today you would earn a total of 1,965 from holding Bausch Health Companies or generate 40.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 25.4% |
| Values | Daily Returns |
Bausch Health Companies vs. Siriuspoint
Performance |
| Timeline |
| Bausch Health Companies |
| Siriuspoint |
Bausch and Siriuspoint Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bausch and Siriuspoint
The main advantage of trading using opposite Bausch and Siriuspoint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bausch position performs unexpectedly, Siriuspoint 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 Siriuspoint will offset losses from the drop in Siriuspoint's long position.The idea behind Bausch Health Companies and Siriuspoint pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Siriuspoint vs. Maiden Holdings | Siriuspoint vs. Reinsurance Group of | Siriuspoint vs. Oxbridge Re Holdings | Siriuspoint vs. Greenlight Capital Re |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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