Correlation Between MetLife and Independence Holding
Can any of the company-specific risk be diversified away by investing in both MetLife and Independence Holding 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 MetLife and Independence Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MetLife and Independence Holding, you can compare the effects of market volatilities on MetLife and Independence Holding 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 MetLife with a short position of Independence Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of MetLife and Independence Holding.
Diversification Opportunities for MetLife and Independence Holding
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MetLife and Independence is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding MetLife and Independence Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Independence Holding and MetLife 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 MetLife are associated (or correlated) with Independence Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Independence Holding has no effect on the direction of MetLife i.e., MetLife and Independence Holding go up and down completely randomly.
Pair Corralation between MetLife and Independence Holding
If you would invest 6,359 in MetLife on January 18, 2024 and sell it today you would earn a total of 534.00 from holding MetLife or generate 8.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
MetLife vs. Independence Holding
Performance |
| Timeline |
| MetLife |
| Independence Holding |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
MetLife and Independence Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MetLife and Independence Holding
The main advantage of trading using opposite MetLife and Independence Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MetLife position performs unexpectedly, Independence Holding 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 Independence Holding will offset losses from the drop in Independence Holding's long position.The idea behind MetLife and Independence Holding 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.| Independence Holding vs. The Cheesecake Factory | Independence Holding vs. Alphatec Holdings | Independence Holding vs. Cracker Barrel Old | Independence Holding vs. Westrock Coffee |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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