Correlation Between ZURICH INSURANCE and KHD Humboldt
Can any of the company-specific risk be diversified away by investing in both ZURICH INSURANCE and KHD Humboldt 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 KHD Humboldt 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 KHD Humboldt Wedag, you can compare the effects of market volatilities on ZURICH INSURANCE and KHD Humboldt 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 KHD Humboldt. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZURICH INSURANCE and KHD Humboldt.
Diversification Opportunities for ZURICH INSURANCE and KHD Humboldt
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ZURICH and KHD is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ZURICH INSURANCE GROUP and KHD Humboldt Wedag in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KHD Humboldt Wedag 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 KHD Humboldt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KHD Humboldt Wedag has no effect on the direction of ZURICH INSURANCE i.e., ZURICH INSURANCE and KHD Humboldt go up and down completely randomly.
Pair Corralation between ZURICH INSURANCE and KHD Humboldt
If you would invest 2,022 in ZURICH INSURANCE GROUP on September 12, 2024 and sell it today you would earn a total of 918.00 from holding ZURICH INSURANCE GROUP or generate 45.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
ZURICH INSURANCE GROUP vs. KHD Humboldt Wedag
Performance |
| Timeline |
| ZURICH INSURANCE |
| KHD Humboldt Wedag |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
ZURICH INSURANCE and KHD Humboldt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZURICH INSURANCE and KHD Humboldt
The main advantage of trading using opposite ZURICH INSURANCE and KHD Humboldt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZURICH INSURANCE position performs unexpectedly, KHD Humboldt 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 KHD Humboldt will offset losses from the drop in KHD Humboldt'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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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