Correlation Between ZURICH INSURANCE and CDL INVESTMENT
Can any of the company-specific risk be diversified away by investing in both ZURICH INSURANCE and CDL INVESTMENT 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 CDL INVESTMENT 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 CDL INVESTMENT, you can compare the effects of market volatilities on ZURICH INSURANCE and CDL INVESTMENT 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 CDL INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZURICH INSURANCE and CDL INVESTMENT.
Diversification Opportunities for ZURICH INSURANCE and CDL INVESTMENT
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ZURICH and CDL is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding ZURICH INSURANCE GROUP and CDL INVESTMENT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDL INVESTMENT 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 CDL INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDL INVESTMENT has no effect on the direction of ZURICH INSURANCE i.e., ZURICH INSURANCE and CDL INVESTMENT go up and down completely randomly.
Pair Corralation between ZURICH INSURANCE and CDL INVESTMENT
Assuming the 90 days trading horizon ZURICH INSURANCE GROUP is expected to generate 0.51 times more return on investment than CDL INVESTMENT. However, ZURICH INSURANCE GROUP is 1.94 times less risky than CDL INVESTMENT. It trades about 0.11 of its potential returns per unit of risk. CDL INVESTMENT is currently generating about 0.05 per unit of risk. If you would invest 2,680 in ZURICH INSURANCE GROUP on September 27, 2024 and sell it today you would earn a total of 180.00 from holding ZURICH INSURANCE GROUP or generate 6.72% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
ZURICH INSURANCE GROUP vs. CDL INVESTMENT
Performance |
Timeline |
ZURICH INSURANCE |
CDL INVESTMENT |
ZURICH INSURANCE and CDL INVESTMENT Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ZURICH INSURANCE and CDL INVESTMENT
The main advantage of trading using opposite ZURICH INSURANCE and CDL INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZURICH INSURANCE position performs unexpectedly, CDL INVESTMENT 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 CDL INVESTMENT will offset losses from the drop in CDL INVESTMENT's long position.ZURICH INSURANCE vs. Zijin Mining Group | ZURICH INSURANCE vs. Fair Isaac Corp | ZURICH INSURANCE vs. Perseus Mining Limited | ZURICH INSURANCE vs. SYSTEMAIR AB |
CDL INVESTMENT vs. Singapore Reinsurance | CDL INVESTMENT vs. CITY OFFICE REIT | CDL INVESTMENT vs. ZURICH INSURANCE GROUP | CDL INVESTMENT vs. KENEDIX OFFICE INV |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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