Correlation Between Zurich Insurance and Wilh Wilhelmsen
Can any of the company-specific risk be diversified away by investing in both Zurich Insurance and Wilh Wilhelmsen 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 Wilh Wilhelmsen 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 Wilh Wilhelmsen Holding, you can compare the effects of market volatilities on Zurich Insurance and Wilh Wilhelmsen 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 Wilh Wilhelmsen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zurich Insurance and Wilh Wilhelmsen.
Diversification Opportunities for Zurich Insurance and Wilh Wilhelmsen
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zurich and Wilh is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Zurich Insurance Group and Wilh Wilhelmsen Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilh Wilhelmsen Holding 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 Wilh Wilhelmsen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilh Wilhelmsen Holding has no effect on the direction of Zurich Insurance i.e., Zurich Insurance and Wilh Wilhelmsen go up and down completely randomly.
Pair Corralation between Zurich Insurance and Wilh Wilhelmsen
Assuming the 90 days trading horizon Zurich Insurance is expected to generate 3.62 times less return on investment than Wilh Wilhelmsen. But when comparing it to its historical volatility, Zurich Insurance Group is 2.31 times less risky than Wilh Wilhelmsen. It trades about 0.06 of its potential returns per unit of risk. Wilh Wilhelmsen Holding is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 753.00 in Wilh Wilhelmsen Holding on September 3, 2024 and sell it today you would earn a total of 2,517 from holding Wilh Wilhelmsen Holding or generate 334.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zurich Insurance Group vs. Wilh Wilhelmsen Holding
Performance |
| Timeline |
| Zurich Insurance |
| Wilh Wilhelmsen Holding |
Zurich Insurance and Wilh Wilhelmsen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zurich Insurance and Wilh Wilhelmsen
The main advantage of trading using opposite Zurich Insurance and Wilh Wilhelmsen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zurich Insurance position performs unexpectedly, Wilh Wilhelmsen 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 Wilh Wilhelmsen will offset losses from the drop in Wilh Wilhelmsen's long position.| Zurich Insurance vs. Berkshire Hathaway | Zurich Insurance vs. Berkshire Hathaway | Zurich Insurance vs. Superior Plus Corp | Zurich Insurance vs. NMI Holdings |
| Wilh Wilhelmsen vs. NISSIN FOODS HLDGS | Wilh Wilhelmsen vs. TYSON FOODS A | Wilh Wilhelmsen vs. Tyson Foods | Wilh Wilhelmsen vs. PREMIER FOODS |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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