Correlation Between MetLife and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both MetLife and Credit Suisse 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 MetLife and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MetLife and Credit Suisse Group, you can compare the effects of market volatilities on MetLife and Credit Suisse 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 MetLife with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of MetLife and Credit Suisse.
Diversification Opportunities for MetLife and Credit Suisse
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MetLife and Credit is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding MetLife and Credit Suisse Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Group and MetLife 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 MetLife are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Group has no effect on the direction of MetLife i.e., MetLife and Credit Suisse go up and down completely randomly.
Pair Corralation between MetLife and Credit Suisse
If you would invest 7,495 in MetLife on September 7, 2024 and sell it today you would earn a total of 1,093 from holding MetLife or generate 14.58% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 1.59% |
Values | Daily Returns |
MetLife vs. Credit Suisse Group
Performance |
Timeline |
MetLife |
Credit Suisse Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
MetLife and Credit Suisse Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with MetLife and Credit Suisse
The main advantage of trading using opposite MetLife and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MetLife position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.MetLife vs. Lincoln National | MetLife vs. Aflac Incorporated | MetLife vs. Unum Group | MetLife vs. Manulife Financial Corp |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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