Correlation Between United Internet and Beeks Trading
Can any of the company-specific risk be diversified away by investing in both United Internet and Beeks Trading 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 United Internet and Beeks Trading into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Internet AG and Beeks Trading, you can compare the effects of market volatilities on United Internet and Beeks Trading 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 United Internet with a short position of Beeks Trading. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Internet and Beeks Trading.
Diversification Opportunities for United Internet and Beeks Trading
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between United and Beeks is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding United Internet AG and Beeks Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beeks Trading and United Internet 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 United Internet AG are associated (or correlated) with Beeks Trading. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beeks Trading has no effect on the direction of United Internet i.e., United Internet and Beeks Trading go up and down completely randomly.
Pair Corralation between United Internet and Beeks Trading
Assuming the 90 days trading horizon United Internet AG is expected to generate 0.57 times more return on investment than Beeks Trading. However, United Internet AG is 1.75 times less risky than Beeks Trading. It trades about -0.03 of its potential returns per unit of risk. Beeks Trading is currently generating about -0.08 per unit of risk. If you would invest 1,523 in United Internet AG on October 26, 2024 and sell it today you would lose (13.00) from holding United Internet AG or give up 0.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Internet AG vs. Beeks Trading
Performance |
| Timeline |
| United Internet AG |
| Beeks Trading |
United Internet and Beeks Trading Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Internet and Beeks Trading
The main advantage of trading using opposite United Internet and Beeks Trading positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Internet position performs unexpectedly, Beeks Trading 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 Beeks Trading will offset losses from the drop in Beeks Trading's long position.| United Internet vs. Molson Coors Beverage | United Internet vs. Pentair PLC | United Internet vs. Pets at Home | United Internet vs. Young Cos Brewery |
| Beeks Trading vs. Fevertree Drinks Plc | Beeks Trading vs. Monster Beverage Corp | Beeks Trading vs. United Internet AG | Beeks Trading vs. Gamma Communications PLC |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |