Correlation Between Victorias Secret and Hamilton Insurance

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

By analyzing existing cross correlation between Victorias Secret Co and Hamilton Insurance Group,, you can compare the effects of market volatilities on Victorias Secret and Hamilton Insurance 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 Victorias Secret with a short position of Hamilton Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victorias Secret and Hamilton Insurance.

Diversification Opportunities for Victorias Secret and Hamilton Insurance

0.53

Correlation Coefficient

Victorias Secret  Hamilton Insurance

Very weak diversification

The 3 months correlation between Victorias and Hamilton is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Victorias Secret Co and Hamilton Insurance Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamilton Insurance Group, and Victorias Secret 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 Victorias Secret Co are associated (or correlated) with Hamilton Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamilton Insurance Group, has no effect on the direction of Victorias Secret i.e., Victorias Secret and Hamilton Insurance go up and down completely randomly.

Pair Corralation between Victorias Secret and Hamilton Insurance

Given the investment horizon of 90 days Victorias Secret Co is expected to under-perform the Hamilton Insurance. In addition to that, Victorias Secret is 2.1 times more volatile than Hamilton Insurance Group,. It trades about -0.27 of its total potential returns per unit of risk. Hamilton Insurance Group, is currently generating about -0.11 per unit of volatility. If you would invest  1,915  in Hamilton Insurance Group, on October 9, 2024 and sell it today you would lose (64.00) from holding Hamilton Insurance Group, or give up 3.34% of portfolio value over 90 days.

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

Victorias Secret Co  vs.  Hamilton Insurance Group,

Victorias Secret

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Victorias Secret Co are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain fundamental indicators, Victorias Secret displayed solid returns over the last few months and may actually be approaching a breakup point.

Hamilton Insurance Group,

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hamilton Insurance Group, are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, Hamilton Insurance is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Victorias Secret and Hamilton Insurance

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

The idea behind Victorias Secret Co and Hamilton Insurance Group, 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.

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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.