Correlation Between Arch Capital and Ageas SA/NV
Can any of the company-specific risk be diversified away by investing in both Arch Capital and Ageas SA/NV 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 Arch Capital and Ageas SA/NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arch Capital Group and ageas SANV, you can compare the effects of market volatilities on Arch Capital and Ageas SA/NV 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 Arch Capital with a short position of Ageas SA/NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arch Capital and Ageas SA/NV.
Diversification Opportunities for Arch Capital and Ageas SA/NV
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Arch and Ageas is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Arch Capital Group and ageas SANV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ageas SA/NV and Arch Capital 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 Arch Capital Group are associated (or correlated) with Ageas SA/NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ageas SA/NV has no effect on the direction of Arch Capital i.e., Arch Capital and Ageas SA/NV go up and down completely randomly.
Pair Corralation between Arch Capital and Ageas SA/NV
Given the investment horizon of 90 days Arch Capital is expected to generate 5.31 times less return on investment than Ageas SA/NV. In addition to that, Arch Capital is 1.28 times more volatile than ageas SANV. It trades about 0.05 of its total potential returns per unit of risk. ageas SANV is currently generating about 0.35 per unit of volatility. If you would invest 4,855 in ageas SANV on December 27, 2024 and sell it today you would earn a total of 1,257 from holding ageas SANV or generate 25.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Arch Capital Group vs. ageas SANV
Performance |
Timeline |
Arch Capital Group |
Ageas SA/NV |
Arch Capital and Ageas SA/NV Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Arch Capital and Ageas SA/NV
The main advantage of trading using opposite Arch Capital and Ageas SA/NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arch Capital position performs unexpectedly, Ageas SA/NV 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 Ageas SA/NV will offset losses from the drop in Ageas SA/NV's long position.Arch Capital vs. Axa Equitable Holdings | Arch Capital vs. American International Group | Arch Capital vs. Old Republic International | Arch Capital vs. Sun Life Financial |
Ageas SA/NV vs. Assicurazioni Generali SpA | Ageas SA/NV vs. AXA SA | Ageas SA/NV vs. Sampo OYJ | Ageas SA/NV vs. Zurich Insurance Group |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
Transaction History View history of all your transactions and understand their impact on performance | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |