Correlation Between Oxbridge and SiriusPoint

Can any of the company-specific risk be diversified away by investing in both Oxbridge and SiriusPoint 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 Oxbridge and SiriusPoint into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Oxbridge Re Holdings and SiriusPoint, you can compare the effects of market volatilities on Oxbridge and SiriusPoint 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 Oxbridge with a short position of SiriusPoint. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oxbridge and SiriusPoint.

Diversification Opportunities for Oxbridge and SiriusPoint

0.42

Correlation Coefficient

Oxbridge  SiriusPoint

Very weak diversification

The 3 months correlation between Oxbridge and SiriusPoint is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Oxbridge Re Holdings and SiriusPoint in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SiriusPoint and Oxbridge 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 Oxbridge Re Holdings are associated (or correlated) with SiriusPoint. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SiriusPoint has no effect on the direction of Oxbridge i.e., Oxbridge and SiriusPoint go up and down completely randomly.

Pair Corralation between Oxbridge and SiriusPoint

Given the investment horizon of 90 days Oxbridge Re Holdings is expected to generate 21.65 times more return on investment than SiriusPoint. However, Oxbridge is 21.65 times more volatile than SiriusPoint. It trades about 0.01 of its potential returns per unit of risk. SiriusPoint is currently generating about 0.01 per unit of risk. If you would invest  390.00  in Oxbridge Re Holdings on December 1, 2024 and sell it today you would lose (28.00) from holding Oxbridge Re Holdings or give up 7.18% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Oxbridge Re Holdings  vs.  SiriusPoint

Oxbridge Re Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Oxbridge Re Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable fundamental drivers, Oxbridge is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

SiriusPoint

Risk-Adjusted Performance

Very Weak

Over the last 90 days SiriusPoint has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, SiriusPoint is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Oxbridge and SiriusPoint

The main advantage of trading using opposite Oxbridge and SiriusPoint positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oxbridge position performs unexpectedly, SiriusPoint 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 SiriusPoint will offset losses from the drop in SiriusPoint's long position.

The idea behind Oxbridge Re Holdings and SiriusPoint pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..