Correlation Between Zurich Insurance and Kraft Heinz
Can any of the company-specific risk be diversified away by investing in both Zurich Insurance and Kraft Heinz 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 Kraft Heinz 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 Kraft Heinz Co, you can compare the effects of market volatilities on Zurich Insurance and Kraft Heinz 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 Kraft Heinz. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zurich Insurance and Kraft Heinz.
Diversification Opportunities for Zurich Insurance and Kraft Heinz
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Zurich and Kraft is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Zurich Insurance Group and Kraft Heinz Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kraft Heinz 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 Kraft Heinz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kraft Heinz has no effect on the direction of Zurich Insurance i.e., Zurich Insurance and Kraft Heinz go up and down completely randomly.
Pair Corralation between Zurich Insurance and Kraft Heinz
Assuming the 90 days trading horizon Zurich Insurance Group is expected to generate 1.41 times more return on investment than Kraft Heinz. However, Zurich Insurance is 1.41 times more volatile than Kraft Heinz Co. It trades about 0.06 of its potential returns per unit of risk. Kraft Heinz Co is currently generating about -0.03 per unit of risk. If you would invest 2,166 in Zurich Insurance Group on October 20, 2024 and sell it today you would earn a total of 614.00 from holding Zurich Insurance Group or generate 28.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zurich Insurance Group vs. Kraft Heinz Co
Performance |
| Timeline |
| Zurich Insurance |
| Kraft Heinz |
Zurich Insurance and Kraft Heinz Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zurich Insurance and Kraft Heinz
The main advantage of trading using opposite Zurich Insurance and Kraft Heinz positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zurich Insurance position performs unexpectedly, Kraft Heinz 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 Kraft Heinz will offset losses from the drop in Kraft Heinz's long position.| Zurich Insurance vs. SOEDER SPORTFISKE AB | Zurich Insurance vs. American Homes 4 | Zurich Insurance vs. DFS Furniture PLC | Zurich Insurance vs. PARKEN Sport Entertainment |
| Kraft Heinz vs. Nestl SA | Kraft Heinz vs. General Mills | Kraft Heinz vs. General Mills | Kraft Heinz vs. Danone SA |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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