Correlation Between Universal Insurance and WISCONSIN
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By analyzing existing cross correlation between Universal Insurance Holdings and WISCONSIN ELEC PWR, you can compare the effects of market volatilities on Universal Insurance and WISCONSIN 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 Universal Insurance with a short position of WISCONSIN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Insurance and WISCONSIN.
Diversification Opportunities for Universal Insurance and WISCONSIN
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Universal and WISCONSIN is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Universal Insurance Holdings and WISCONSIN ELEC PWR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WISCONSIN ELEC PWR and Universal Insurance 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 Universal Insurance Holdings are associated (or correlated) with WISCONSIN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WISCONSIN ELEC PWR has no effect on the direction of Universal Insurance i.e., Universal Insurance and WISCONSIN go up and down completely randomly.
Pair Corralation between Universal Insurance and WISCONSIN
Considering the 90-day investment horizon Universal Insurance Holdings is expected to generate 0.58 times more return on investment than WISCONSIN. However, Universal Insurance Holdings is 1.72 times less risky than WISCONSIN. It trades about -0.35 of its potential returns per unit of risk. WISCONSIN ELEC PWR is currently generating about -0.33 per unit of risk. If you would invest 2,181 in Universal Insurance Holdings on October 9, 2024 and sell it today you would lose (214.00) from holding Universal Insurance Holdings or give up 9.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 42.11% |
| Values | Daily Returns |
Universal Insurance Holdings vs. WISCONSIN ELEC PWR
Performance |
| Timeline |
| Universal Insurance |
| WISCONSIN ELEC PWR |
Universal Insurance and WISCONSIN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Universal Insurance and WISCONSIN
The main advantage of trading using opposite Universal Insurance and WISCONSIN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Universal Insurance position performs unexpectedly, WISCONSIN 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 WISCONSIN will offset losses from the drop in WISCONSIN's long position.| Universal Insurance vs. HCI Group | Universal Insurance vs. Kingstone Companies | Universal Insurance vs. Horace Mann Educators | Universal Insurance vs. Heritage Insurance Hldgs |
| WISCONSIN vs. National CineMedia | WISCONSIN vs. Dave Busters Entertainment | WISCONSIN vs. TechTarget, Common Stock | WISCONSIN vs. Precision Optics, |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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