Correlation Between ZURICH INSURANCE and DFDS AS
Can any of the company-specific risk be diversified away by investing in both ZURICH INSURANCE and DFDS AS 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 DFDS AS 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 DFDS AS, you can compare the effects of market volatilities on ZURICH INSURANCE and DFDS AS 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 DFDS AS. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZURICH INSURANCE and DFDS AS.
Diversification Opportunities for ZURICH INSURANCE and DFDS AS
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ZURICH and DFDS is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding ZURICH INSURANCE GROUP and DFDS AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DFDS AS 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 DFDS AS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DFDS AS has no effect on the direction of ZURICH INSURANCE i.e., ZURICH INSURANCE and DFDS AS go up and down completely randomly.
Pair Corralation between ZURICH INSURANCE and DFDS AS
Assuming the 90 days trading horizon ZURICH INSURANCE GROUP is expected to under-perform the DFDS AS. But the stock apears to be less risky and, when comparing its historical volatility, ZURICH INSURANCE GROUP is 2.98 times less risky than DFDS AS. The stock trades about -0.26 of its potential returns per unit of risk. The DFDS AS is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 1,901 in DFDS AS on October 7, 2024 and sell it today you would lose (74.00) from holding DFDS AS or give up 3.89% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
ZURICH INSURANCE GROUP vs. DFDS AS
Performance |
Timeline |
ZURICH INSURANCE |
DFDS AS |
ZURICH INSURANCE and DFDS AS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ZURICH INSURANCE and DFDS AS
The main advantage of trading using opposite ZURICH INSURANCE and DFDS AS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZURICH INSURANCE position performs unexpectedly, DFDS AS 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 DFDS AS will offset losses from the drop in DFDS AS's long position.ZURICH INSURANCE vs. Apple Inc | ZURICH INSURANCE vs. Apple Inc | ZURICH INSURANCE vs. Apple Inc | ZURICH INSURANCE vs. Apple Inc |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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