Correlation Between Marie Brizard and Cincinnati Financial
Can any of the company-specific risk be diversified away by investing in both Marie Brizard and Cincinnati Financial 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 Marie Brizard and Cincinnati Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Marie Brizard Wine and Cincinnati Financial Corp, you can compare the effects of market volatilities on Marie Brizard and Cincinnati Financial 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 Marie Brizard with a short position of Cincinnati Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marie Brizard and Cincinnati Financial.
Diversification Opportunities for Marie Brizard and Cincinnati Financial
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Marie and Cincinnati is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Marie Brizard Wine and Cincinnati Financial Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cincinnati Financial Corp and Marie Brizard 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 Marie Brizard Wine are associated (or correlated) with Cincinnati Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cincinnati Financial Corp has no effect on the direction of Marie Brizard i.e., Marie Brizard and Cincinnati Financial go up and down completely randomly.
Pair Corralation between Marie Brizard and Cincinnati Financial
Assuming the 90 days trading horizon Marie Brizard Wine is expected to under-perform the Cincinnati Financial. But the stock apears to be less risky and, when comparing its historical volatility, Marie Brizard Wine is 1.55 times less risky than Cincinnati Financial. The stock trades about -0.06 of its potential returns per unit of risk. The Cincinnati Financial Corp is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 12,656 in Cincinnati Financial Corp on October 24, 2024 and sell it today you would earn a total of 649.00 from holding Cincinnati Financial Corp or generate 5.13% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Marie Brizard Wine vs. Cincinnati Financial Corp
Performance |
Timeline |
Marie Brizard Wine |
Cincinnati Financial Corp |
Marie Brizard and Cincinnati Financial Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Marie Brizard and Cincinnati Financial
The main advantage of trading using opposite Marie Brizard and Cincinnati Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Marie Brizard position performs unexpectedly, Cincinnati Financial 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 Cincinnati Financial will offset losses from the drop in Cincinnati Financial's long position.Marie Brizard vs. Firan Technology Group | Marie Brizard vs. AGNC INVESTMENT | Marie Brizard vs. MidCap Financial Investment | Marie Brizard vs. PKSHA TECHNOLOGY 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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