Correlation Between Zurich Insurance and Grammer AG
Can any of the company-specific risk be diversified away by investing in both Zurich Insurance and Grammer AG 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 Zurich Insurance and Grammer AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zurich Insurance Group and Grammer AG, you can compare the effects of market volatilities on Zurich Insurance and Grammer AG 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 Zurich Insurance with a short position of Grammer AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zurich Insurance and Grammer AG.
Diversification Opportunities for Zurich Insurance and Grammer AG
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Zurich and Grammer is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Zurich Insurance Group and Grammer AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grammer AG and Zurich 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 Zurich Insurance Group are associated (or correlated) with Grammer AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grammer AG has no effect on the direction of Zurich Insurance i.e., Zurich Insurance and Grammer AG go up and down completely randomly.
Pair Corralation between Zurich Insurance and Grammer AG
Assuming the 90 days trading horizon Zurich Insurance Group is expected to generate 0.56 times more return on investment than Grammer AG. However, Zurich Insurance Group is 1.78 times less risky than Grammer AG. It trades about 0.06 of its potential returns per unit of risk. Grammer AG is currently generating about -0.03 per unit of risk. If you would invest 1,994 in Zurich Insurance Group on September 3, 2024 and sell it today you would earn a total of 1,026 from holding Zurich Insurance Group or generate 51.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zurich Insurance Group vs. Grammer AG
Performance |
| Timeline |
| Zurich Insurance |
| Grammer AG |
Zurich Insurance and Grammer AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zurich Insurance and Grammer AG
The main advantage of trading using opposite Zurich Insurance and Grammer AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zurich Insurance position performs unexpectedly, Grammer AG 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 Grammer AG will offset losses from the drop in Grammer AG's long position.| Zurich Insurance vs. Berkshire Hathaway | Zurich Insurance vs. Berkshire Hathaway | Zurich Insurance vs. Superior Plus Corp | Zurich Insurance vs. NMI Holdings |
| Grammer AG vs. Zurich Insurance Group | Grammer AG vs. Waste Management | Grammer AG vs. Ares Management Corp | Grammer AG vs. INSURANCE AUST GRP |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| 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 | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |