Correlation Between Excel Corp and Verisk Analytics
Can any of the company-specific risk be diversified away by investing in both Excel Corp and Verisk Analytics 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 Excel Corp and Verisk Analytics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Excel Corp and Verisk Analytics, you can compare the effects of market volatilities on Excel Corp and Verisk Analytics 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 Excel Corp with a short position of Verisk Analytics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Excel Corp and Verisk Analytics.
Diversification Opportunities for Excel Corp and Verisk Analytics
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Excel and Verisk is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Excel Corp and Verisk Analytics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Verisk Analytics and Excel Corp 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 Excel Corp are associated (or correlated) with Verisk Analytics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Verisk Analytics has no effect on the direction of Excel Corp i.e., Excel Corp and Verisk Analytics go up and down completely randomly.
Pair Corralation between Excel Corp and Verisk Analytics
Given the investment horizon of 90 days Excel Corp is expected to generate 268.28 times more return on investment than Verisk Analytics. However, Excel Corp is 268.28 times more volatile than Verisk Analytics. It trades about 0.19 of its potential returns per unit of risk. Verisk Analytics is currently generating about -0.24 per unit of risk. If you would invest 0.01 in Excel Corp on January 25, 2024 and sell it today you would earn a total of 0.00 from holding Excel Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Excel Corp vs. Verisk Analytics
Performance |
| Timeline |
| Excel Corp |
| Verisk Analytics |
Excel Corp and Verisk Analytics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Excel Corp and Verisk Analytics
The main advantage of trading using opposite Excel Corp and Verisk Analytics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Excel Corp position performs unexpectedly, Verisk Analytics 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 Verisk Analytics will offset losses from the drop in Verisk Analytics' long position.The idea behind Excel Corp and Verisk Analytics 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.| Verisk Analytics vs. BrightView Holdings | Verisk Analytics vs. Maximus | Verisk Analytics vs. First Advantage Corp | Verisk Analytics vs. Cass Information Systems |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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