Correlation Between Weyco and Aspen Insurance
Can any of the company-specific risk be diversified away by investing in both Weyco and Aspen 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 Weyco and Aspen Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weyco Group and Aspen Insurance Holdings, you can compare the effects of market volatilities on Weyco and Aspen 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 Weyco with a short position of Aspen Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weyco and Aspen Insurance.
Diversification Opportunities for Weyco and Aspen Insurance
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Weyco and Aspen is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Weyco Group and Aspen Insurance Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aspen Insurance Holdings and Weyco 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 Weyco Group are associated (or correlated) with Aspen Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aspen Insurance Holdings has no effect on the direction of Weyco i.e., Weyco and Aspen Insurance go up and down completely randomly.
Pair Corralation between Weyco and Aspen Insurance
Given the investment horizon of 90 days Weyco Group is expected to under-perform the Aspen Insurance. In addition to that, Weyco is 1.43 times more volatile than Aspen Insurance Holdings. It trades about -0.23 of its total potential returns per unit of risk. Aspen Insurance Holdings is currently generating about -0.09 per unit of volatility. If you would invest 2,252 in Aspen Insurance Holdings on September 12, 2024 and sell it today you would lose (65.00) from holding Aspen Insurance Holdings or give up 2.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Weyco Group vs. Aspen Insurance Holdings
Performance |
| Timeline |
| Weyco Group |
| Aspen Insurance Holdings |
Weyco and Aspen Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weyco and Aspen Insurance
The main advantage of trading using opposite Weyco and Aspen Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weyco position performs unexpectedly, Aspen 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 Aspen Insurance will offset losses from the drop in Aspen Insurance's long position.The idea behind Weyco Group and Aspen Insurance Holdings 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.| Aspen Insurance vs. Aspen Insurance Holdings | Aspen Insurance vs. Selective Insurance Group | Aspen Insurance vs. The Allstate | Aspen Insurance vs. AmTrust Financial Services |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |