Correlation Between Coor Service and Assicurazioni Generali

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

By analyzing existing cross correlation between Coor Service Management and Assicurazioni Generali SpA, you can compare the effects of market volatilities on Coor Service and Assicurazioni Generali 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 Coor Service with a short position of Assicurazioni Generali. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coor Service and Assicurazioni Generali.

Diversification Opportunities for Coor Service and Assicurazioni Generali

-0.47

Correlation Coefficient

Coor Service  Assicurazioni Generali

Very good diversification

The 3 months correlation between Coor and Assicurazioni is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Coor Service Management and Assicurazioni Generali SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Assicurazioni Generali and Coor Service 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 Coor Service Management are associated (or correlated) with Assicurazioni Generali. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Assicurazioni Generali has no effect on the direction of Coor Service i.e., Coor Service and Assicurazioni Generali go up and down completely randomly.

Pair Corralation between Coor Service and Assicurazioni Generali

Assuming the 90 days horizon Coor Service Management is expected to generate 0.94 times more return on investment than Assicurazioni Generali. However, Coor Service Management is 1.06 times less risky than Assicurazioni Generali. It trades about 0.05 of its potential returns per unit of risk. Assicurazioni Generali SpA is currently generating about -0.03 per unit of risk. If you would invest  281.00  in Coor Service Management on September 26, 2024 and sell it today you would earn a total of  3.00  from holding Coor Service Management or generate 1.07% return on investment over 90 days.

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

Coor Service Management  vs.  Assicurazioni Generali SpA

Coor Service Management

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Coor Service Management has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Assicurazioni Generali

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Assicurazioni Generali SpA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Assicurazioni Generali is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Coor Service and Assicurazioni Generali

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

The idea behind Coor Service Management and Assicurazioni Generali SpA 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.