Correlation Between Swiss Re and EFG International
Can any of the company-specific risk be diversified away by investing in both Swiss Re and EFG International 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 Swiss Re and EFG International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swiss Re AG and EFG International AG, you can compare the effects of market volatilities on Swiss Re and EFG International 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 Swiss Re with a short position of EFG International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swiss Re and EFG International.
Diversification Opportunities for Swiss Re and EFG International
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Swiss and EFG is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Swiss Re AG and EFG International AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EFG International and Swiss Re 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 Swiss Re AG are associated (or correlated) with EFG International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EFG International has no effect on the direction of Swiss Re i.e., Swiss Re and EFG International go up and down completely randomly.
Pair Corralation between Swiss Re and EFG International
Assuming the 90 days trading horizon Swiss Re AG is expected to generate 1.05 times more return on investment than EFG International. However, Swiss Re is 1.05 times more volatile than EFG International AG. It trades about -0.01 of its potential returns per unit of risk. EFG International AG is currently generating about -0.04 per unit of risk. If you would invest 14,770 in Swiss Re AG on July 23, 2025 and sell it today you would lose (175.00) from holding Swiss Re AG or give up 1.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Swiss Re AG vs. EFG International AG
Performance |
| Timeline |
| Swiss Re AG |
| EFG International |
Swiss Re and EFG International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swiss Re and EFG International
The main advantage of trading using opposite Swiss Re and EFG International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swiss Re position performs unexpectedly, EFG International 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 EFG International will offset losses from the drop in EFG International's long position.| Swiss Re vs. Swiss Life Holding | Swiss Re vs. Partners Group Holding | Swiss Re vs. Zurich Insurance Group | Swiss Re vs. Helvetia Holding AG |
| EFG International vs. Luzerner Kantonalbank AG | EFG International vs. Vontobel Holding | EFG International vs. St Galler Kantonalbank | EFG International vs. VZ Holding AG |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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