Correlation Between Peoples Insurance and Fastenal

Can any of the company-specific risk be diversified away by investing in both Peoples Insurance and Fastenal 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 Fastenal 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 Fastenal Company, you can compare the effects of market volatilities on Peoples Insurance and Fastenal 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 Fastenal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peoples Insurance and Fastenal.

Diversification Opportunities for Peoples Insurance and Fastenal

-0.33

Correlation Coefficient

Peoples Insurance  Fastenal

Very good diversification

The 3 months correlation between Peoples and Fastenal is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding The Peoples Insurance and Fastenal Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fastenal 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 Fastenal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fastenal has no effect on the direction of Peoples Insurance i.e., Peoples Insurance and Fastenal go up and down completely randomly.

Pair Corralation between Peoples Insurance and Fastenal

Assuming the 90 days horizon The Peoples Insurance is expected to generate 1.33 times more return on investment than Fastenal. However, Peoples Insurance is 1.33 times more volatile than Fastenal Company. It trades about 0.13 of its potential returns per unit of risk. Fastenal Company is currently generating about -0.08 per unit of risk. If you would invest  67.00  in The Peoples Insurance on July 27, 2025 and sell it today you would earn a total of  13.00  from holding The Peoples Insurance or generate 19.4% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.48%
Values	Daily Returns

The Peoples Insurance  vs.  Fastenal Company

Peoples Insurance

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in The Peoples Insurance are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Peoples Insurance reported solid returns over the last few months and may actually be approaching a breakup point.

Fastenal

Risk-Adjusted Performance

Weakest

Over the last 90 days Fastenal Company has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Peoples Insurance and Fastenal

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

The idea behind The Peoples Insurance and Fastenal Company 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.