Correlation Between Hanover Insurance and ROMERIKE SPAREBANK
Can any of the company-specific risk be diversified away by investing in both Hanover Insurance and ROMERIKE SPAREBANK 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 Hanover Insurance and ROMERIKE SPAREBANK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hanover Insurance and ROMERIKE SPAREBANK NK, you can compare the effects of market volatilities on Hanover Insurance and ROMERIKE SPAREBANK 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 Hanover Insurance with a short position of ROMERIKE SPAREBANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanover Insurance and ROMERIKE SPAREBANK.
Diversification Opportunities for Hanover Insurance and ROMERIKE SPAREBANK
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Hanover and ROMERIKE is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding The Hanover Insurance and ROMERIKE SPAREBANK NK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ROMERIKE SPAREBANK and Hanover 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 The Hanover Insurance are associated (or correlated) with ROMERIKE SPAREBANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ROMERIKE SPAREBANK has no effect on the direction of Hanover Insurance i.e., Hanover Insurance and ROMERIKE SPAREBANK go up and down completely randomly.
Pair Corralation between Hanover Insurance and ROMERIKE SPAREBANK
Assuming the 90 days horizon The Hanover Insurance is expected to generate 1.93 times more return on investment than ROMERIKE SPAREBANK. However, Hanover Insurance is 1.93 times more volatile than ROMERIKE SPAREBANK NK. It trades about 0.02 of its potential returns per unit of risk. ROMERIKE SPAREBANK NK is currently generating about -0.01 per unit of risk. If you would invest 13,825 in The Hanover Insurance on April 24, 2025 and sell it today you would earn a total of 175.00 from holding The Hanover Insurance or generate 1.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
The Hanover Insurance vs. ROMERIKE SPAREBANK NK
Performance |
Timeline |
Hanover Insurance |
ROMERIKE SPAREBANK |
Hanover Insurance and ROMERIKE SPAREBANK Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hanover Insurance and ROMERIKE SPAREBANK
The main advantage of trading using opposite Hanover Insurance and ROMERIKE SPAREBANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanover Insurance position performs unexpectedly, ROMERIKE SPAREBANK 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 ROMERIKE SPAREBANK will offset losses from the drop in ROMERIKE SPAREBANK's long position.Hanover Insurance vs. Coeur Mining | Hanover Insurance vs. GRIFFIN MINING LTD | Hanover Insurance vs. MUTUIONLINE | Hanover Insurance vs. GOLDGROUP MINING INC |
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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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