Correlation Between UNIQA Insurance and Prudential Financial
Can any of the company-specific risk be diversified away by investing in both UNIQA Insurance and Prudential Financial 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 UNIQA Insurance and Prudential Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UNIQA Insurance Group and Prudential Financial, you can compare the effects of market volatilities on UNIQA Insurance and Prudential Financial 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 UNIQA Insurance with a short position of Prudential Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQA Insurance and Prudential Financial.
Diversification Opportunities for UNIQA Insurance and Prudential Financial
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between UNIQA and Prudential is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA Insurance Group and Prudential Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prudential Financial and UNIQA 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 UNIQA Insurance Group are associated (or correlated) with Prudential Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prudential Financial has no effect on the direction of UNIQA Insurance i.e., UNIQA Insurance and Prudential Financial go up and down completely randomly.
Pair Corralation between UNIQA Insurance and Prudential Financial
Assuming the 90 days trading horizon UNIQA Insurance Group is expected to generate 0.9 times more return on investment than Prudential Financial. However, UNIQA Insurance Group is 1.12 times less risky than Prudential Financial. It trades about 0.12 of its potential returns per unit of risk. Prudential Financial is currently generating about -0.1 per unit of risk. If you would invest 720.00 in UNIQA Insurance Group on September 13, 2024 and sell it today you would earn a total of 21.00 from holding UNIQA Insurance Group or generate 2.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
UNIQA Insurance Group vs. Prudential Financial
Performance |
| Timeline |
| UNIQA Insurance Group |
| Prudential Financial |
UNIQA Insurance and Prudential Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UNIQA Insurance and Prudential Financial
The main advantage of trading using opposite UNIQA Insurance and Prudential Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNIQA Insurance position performs unexpectedly, Prudential Financial 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 Prudential Financial will offset losses from the drop in Prudential Financial's long position.| UNIQA Insurance vs. Samsung Electronics Co | UNIQA Insurance vs. Samsung Electronics Co | UNIQA Insurance vs. Hyundai Motor | UNIQA Insurance vs. Reliance Industries Ltd |
| Prudential Financial vs. Ally Financial | Prudential Financial vs. Synthomer plc | Prudential Financial vs. Ecclesiastical Insurance Office | Prudential Financial vs. Komercni Banka |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |