Correlation Between Zurich Insurance and Perseus Mining
Can any of the company-specific risk be diversified away by investing in both Zurich Insurance and Perseus Mining 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 Perseus Mining 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 Perseus Mining Limited, you can compare the effects of market volatilities on Zurich Insurance and Perseus Mining 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 Perseus Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zurich Insurance and Perseus Mining.
Diversification Opportunities for Zurich Insurance and Perseus Mining
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Zurich and Perseus is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Zurich Insurance Group and Perseus Mining Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perseus Mining 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 Perseus Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perseus Mining has no effect on the direction of Zurich Insurance i.e., Zurich Insurance and Perseus Mining go up and down completely randomly.
Pair Corralation between Zurich Insurance and Perseus Mining
Assuming the 90 days trading horizon Zurich Insurance Group is expected to generate 0.9 times more return on investment than Perseus Mining. However, Zurich Insurance Group is 1.11 times less risky than Perseus Mining. It trades about 0.08 of its potential returns per unit of risk. Perseus Mining Limited is currently generating about 0.06 per unit of risk. If you would invest 2,640 in Zurich Insurance Group on September 15, 2024 and sell it today you would earn a total of 260.00 from holding Zurich Insurance Group or generate 9.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Zurich Insurance Group vs. Perseus Mining Limited
Performance |
Timeline |
Zurich Insurance |
Perseus Mining |
Zurich Insurance and Perseus Mining Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zurich Insurance and Perseus Mining
The main advantage of trading using opposite Zurich Insurance and Perseus Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zurich Insurance position performs unexpectedly, Perseus Mining 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 Perseus Mining will offset losses from the drop in Perseus Mining's long position.Zurich Insurance vs. Superior Plus Corp | Zurich Insurance vs. SIVERS SEMICONDUCTORS AB | Zurich Insurance vs. CHINA HUARONG ENERHD 50 | Zurich Insurance vs. NORDIC HALIBUT AS |
Perseus Mining vs. United Insurance Holdings | Perseus Mining vs. Strategic Education | Perseus Mining vs. UNITED RENTALS | Perseus Mining vs. Zurich Insurance Group |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |