Correlation Between Peoples Insurance and Tokio Marine
Can any of the company-specific risk be diversified away by investing in both Peoples Insurance and Tokio Marine 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 Peoples Insurance and Tokio Marine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Peoples Insurance and Tokio Marine Holdings, you can compare the effects of market volatilities on Peoples Insurance and Tokio Marine 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 Peoples Insurance with a short position of Tokio Marine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peoples Insurance and Tokio Marine.
Diversification Opportunities for Peoples Insurance and Tokio Marine
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Peoples and Tokio is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding The Peoples Insurance and Tokio Marine Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tokio Marine Holdings and Peoples 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 Peoples Insurance are associated (or correlated) with Tokio Marine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tokio Marine Holdings has no effect on the direction of Peoples Insurance i.e., Peoples Insurance and Tokio Marine go up and down completely randomly.
Pair Corralation between Peoples Insurance and Tokio Marine
Assuming the 90 days horizon The Peoples Insurance is expected to generate 0.07 times more return on investment than Tokio Marine. However, The Peoples Insurance is 14.32 times less risky than Tokio Marine. It trades about -0.01 of its potential returns per unit of risk. Tokio Marine Holdings is currently generating about -0.18 per unit of risk. If you would invest 74.00 in The Peoples Insurance on September 11, 2025 and sell it today you would lose (3.00) from holding The Peoples Insurance or give up 4.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Peoples Insurance vs. Tokio Marine Holdings
Performance |
| Timeline |
| Peoples Insurance |
| Tokio Marine Holdings |
Peoples Insurance and Tokio Marine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peoples Insurance and Tokio Marine
The main advantage of trading using opposite Peoples Insurance and Tokio Marine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peoples Insurance position performs unexpectedly, Tokio Marine 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 Tokio Marine will offset losses from the drop in Tokio Marine's long position.| Peoples Insurance vs. Tokio Marine Holdings | Peoples Insurance vs. The Hanover Insurance | Peoples Insurance vs. Kemper |
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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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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