Correlation Between MARKET VECTR and United Insurance
Can any of the company-specific risk be diversified away by investing in both MARKET VECTR and United Insurance 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 MARKET VECTR and United Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MARKET VECTR RETAIL and United Insurance Holdings, you can compare the effects of market volatilities on MARKET VECTR and United Insurance 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 MARKET VECTR with a short position of United Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of MARKET VECTR and United Insurance.
Diversification Opportunities for MARKET VECTR and United Insurance
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MARKET and United is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding MARKET VECTR RETAIL and United Insurance Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Insurance Holdings and MARKET VECTR 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 MARKET VECTR RETAIL are associated (or correlated) with United Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Insurance Holdings has no effect on the direction of MARKET VECTR i.e., MARKET VECTR and United Insurance go up and down completely randomly.
Pair Corralation between MARKET VECTR and United Insurance
Assuming the 90 days trading horizon MARKET VECTR RETAIL is expected to generate 0.4 times more return on investment than United Insurance. However, MARKET VECTR RETAIL is 2.49 times less risky than United Insurance. It trades about 0.44 of its potential returns per unit of risk. United Insurance Holdings is currently generating about -0.09 per unit of risk. If you would invest 21,855 in MARKET VECTR RETAIL on November 9, 2024 and sell it today you would earn a total of 1,380 from holding MARKET VECTR RETAIL or generate 6.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MARKET VECTR RETAIL vs. United Insurance Holdings
Performance |
| Timeline |
| MARKET VECTR RETAIL |
| United Insurance Holdings |
MARKET VECTR and United Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MARKET VECTR and United Insurance
The main advantage of trading using opposite MARKET VECTR and United Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MARKET VECTR position performs unexpectedly, United Insurance 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 United Insurance will offset losses from the drop in United Insurance's long position.| MARKET VECTR vs. MeVis Medical Solutions | MARKET VECTR vs. Haverty Furniture Companies | MARKET VECTR vs. Scandinavian Tobacco Group | MARKET VECTR vs. IMPERIAL TOBACCO |
| United Insurance vs. TERADATA | United Insurance vs. GEELY AUTOMOBILE | United Insurance vs. China Datang | United Insurance vs. DATAGROUP SE |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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