Correlation Between ZURICH INSURANCE and KWS SAAT
Can any of the company-specific risk be diversified away by investing in both ZURICH INSURANCE and KWS SAAT 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 KWS SAAT 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 KWS SAAT SE, you can compare the effects of market volatilities on ZURICH INSURANCE and KWS SAAT 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 KWS SAAT. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZURICH INSURANCE and KWS SAAT.
Diversification Opportunities for ZURICH INSURANCE and KWS SAAT
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ZURICH and KWS is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding ZURICH INSURANCE GROUP and KWS SAAT SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KWS SAAT SE 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 KWS SAAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KWS SAAT SE has no effect on the direction of ZURICH INSURANCE i.e., ZURICH INSURANCE and KWS SAAT go up and down completely randomly.
Pair Corralation between ZURICH INSURANCE and KWS SAAT
Assuming the 90 days trading horizon ZURICH INSURANCE GROUP is expected to generate 0.55 times more return on investment than KWS SAAT. However, ZURICH INSURANCE GROUP is 1.82 times less risky than KWS SAAT. It trades about 0.41 of its potential returns per unit of risk. KWS SAAT SE is currently generating about -0.09 per unit of risk. If you would invest 2,700 in ZURICH INSURANCE GROUP on September 4, 2024 and sell it today you would earn a total of 280.00 from holding ZURICH INSURANCE GROUP or generate 10.37% 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. KWS SAAT SE
Performance |
| Timeline |
| ZURICH INSURANCE |
| KWS SAAT SE |
ZURICH INSURANCE and KWS SAAT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZURICH INSURANCE and KWS SAAT
The main advantage of trading using opposite ZURICH INSURANCE and KWS SAAT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZURICH INSURANCE position performs unexpectedly, KWS SAAT 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 KWS SAAT will offset losses from the drop in KWS SAAT's long position.| ZURICH INSURANCE vs. TOTAL GABON | ZURICH INSURANCE vs. Walgreens Boots Alliance | ZURICH INSURANCE vs. Peak Resources Limited |
| KWS SAAT vs. Archer Daniels Midland | KWS SAAT vs. Tyson Foods | KWS SAAT vs. Wilmar International Limited | KWS SAAT vs. SalMar ASA |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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