Correlation Between Definity Financial and Trisura

Can any of the company-specific risk be diversified away by investing in both Definity Financial and Trisura 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 Definity Financial and Trisura into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Definity Financial Corp and Trisura Group, you can compare the effects of market volatilities on Definity Financial and Trisura 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 Definity Financial with a short position of Trisura. Check out your portfolio center. Please also check ongoing floating volatility patterns of Definity Financial and Trisura.

Diversification Opportunities for Definity Financial and Trisura

0.92

Correlation Coefficient

Definity Financial  Trisura

Almost no diversification

The 3 months correlation between Definity and Trisura is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Definity Financial Corp and Trisura Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trisura Group and Definity Financial 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 Definity Financial Corp are associated (or correlated) with Trisura. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trisura Group has no effect on the direction of Definity Financial i.e., Definity Financial and Trisura go up and down completely randomly.

Pair Corralation between Definity Financial and Trisura

Assuming the 90 days trading horizon Definity Financial is expected to generate 1.21 times less return on investment than Trisura. In addition to that, Definity Financial is 1.53 times more volatile than Trisura Group. It trades about 0.13 of its total potential returns per unit of risk. Trisura Group is currently generating about 0.24 per unit of volatility. If you would invest  3,707  in Trisura Group on April 24, 2025 and sell it today you would earn a total of  772.00  from holding Trisura Group or generate 20.83% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Definity Financial Corp  vs.  Trisura Group

Definity Financial Corp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Definity Financial Corp are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Definity Financial displayed solid returns over the last few months and may actually be approaching a breakup point.

Trisura Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Trisura Group are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Trisura displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Definity Financial and Trisura

The main advantage of trading using opposite Definity Financial and Trisura positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Definity Financial position performs unexpectedly, Trisura 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 Trisura will offset losses from the drop in Trisura's long position.

The idea behind Definity Financial Corp and Trisura Group 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.