Correlation Between Snap and Protective Life

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Can any of the company-specific risk be diversified away by investing in both Snap and Protective Life 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 Snap and Protective Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Snap Inc and Protective Life Dynamic, you can compare the effects of market volatilities on Snap and Protective Life 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 Snap with a short position of Protective Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Snap and Protective Life.

Diversification Opportunities for Snap and Protective Life

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Snap and Protective is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Snap Inc and PROTECTIVE LIFE DYNAMIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protective Life Dynamic and Snap 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 Snap Inc are associated (or correlated) with Protective Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protective Life Dynamic has no effect on the direction of Snap i.e., Snap and Protective Life go up and down completely randomly.

Pair Corralation between Snap and Protective Life

If you would invest (100.00) in Protective Life Dynamic on December 30, 2023 and sell it today you would earn a total of  100.00  from holding Protective Life Dynamic or generate -100.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Snap Inc  vs.  PROTECTIVE LIFE DYNAMIC

 Performance 
       Timeline  
Snap Inc 

Risk-Adjusted Performance

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High
Very Weak
Over the last 90 days Snap Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.
Protective Life Dynamic 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Protective Life Dynamic has generated negative risk-adjusted returns adding no value to fund investors. In spite of very healthy basic indicators, Protective Life is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Snap and Protective Life Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Snap and Protective Life

The main advantage of trading using opposite Snap and Protective Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Snap position performs unexpectedly, Protective Life 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 Protective Life will offset losses from the drop in Protective Life's long position.
The idea behind Snap Inc and Protective Life Dynamic 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.

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