Correlation Between UNIQA Insurance and FinecoBank SpA
Can any of the company-specific risk be diversified away by investing in both UNIQA Insurance and FinecoBank SpA 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 FinecoBank SpA 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 FinecoBank SpA, you can compare the effects of market volatilities on UNIQA Insurance and FinecoBank SpA 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 FinecoBank SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQA Insurance and FinecoBank SpA.
Diversification Opportunities for UNIQA Insurance and FinecoBank SpA
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between UNIQA and FinecoBank is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA Insurance Group and FinecoBank SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FinecoBank SpA 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 FinecoBank SpA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FinecoBank SpA has no effect on the direction of UNIQA Insurance i.e., UNIQA Insurance and FinecoBank SpA go up and down completely randomly.
Pair Corralation between UNIQA Insurance and FinecoBank SpA
Assuming the 90 days trading horizon UNIQA Insurance Group is expected to generate 1.02 times more return on investment than FinecoBank SpA. However, UNIQA Insurance is 1.02 times more volatile than FinecoBank SpA. It trades about 0.43 of its potential returns per unit of risk. FinecoBank SpA is currently generating about 0.2 per unit of risk. If you would invest 743.00 in UNIQA Insurance Group on October 14, 2024 and sell it today you would earn a total of 58.00 from holding UNIQA Insurance Group or generate 7.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
UNIQA Insurance Group vs. FinecoBank SpA
Performance |
| Timeline |
| UNIQA Insurance Group |
| FinecoBank SpA |
UNIQA Insurance and FinecoBank SpA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UNIQA Insurance and FinecoBank SpA
The main advantage of trading using opposite UNIQA Insurance and FinecoBank SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNIQA Insurance position performs unexpectedly, FinecoBank SpA 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 FinecoBank SpA will offset losses from the drop in FinecoBank SpA's long position.| UNIQA Insurance vs. Public Storage | UNIQA Insurance vs. Premier Foods PLC | UNIQA Insurance vs. Axfood AB | UNIQA Insurance vs. Bell Food Group |
| FinecoBank SpA vs. BW Offshore | FinecoBank SpA vs. Morgan Advanced Materials | FinecoBank SpA vs. Compagnie Plastic Omnium | FinecoBank SpA vs. UNIQA Insurance Group |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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