Correlation Between American Tower and UNIQA Insurance
Can any of the company-specific risk be diversified away by investing in both American Tower and UNIQA Insurance 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 American Tower and UNIQA Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Tower REIT and UNIQA Insurance Group, you can compare the effects of market volatilities on American Tower and UNIQA Insurance 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 American Tower with a short position of UNIQA Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Tower and UNIQA Insurance.
Diversification Opportunities for American Tower and UNIQA Insurance
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between American and UNIQA is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding American Tower REIT and UNIQA Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNIQA Insurance Group and American Tower 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 American Tower REIT are associated (or correlated) with UNIQA Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNIQA Insurance Group has no effect on the direction of American Tower i.e., American Tower and UNIQA Insurance go up and down completely randomly.
Pair Corralation between American Tower and UNIQA Insurance
Assuming the 90 days trading horizon American Tower is expected to generate 1.92 times less return on investment than UNIQA Insurance. In addition to that, American Tower is 2.39 times more volatile than UNIQA Insurance Group. It trades about 0.01 of its total potential returns per unit of risk. UNIQA Insurance Group is currently generating about 0.06 per unit of volatility. If you would invest 589.00 in UNIQA Insurance Group on September 12, 2024 and sell it today you would earn a total of 134.00 from holding UNIQA Insurance Group or generate 22.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.79% |
| Values | Daily Returns |
American Tower REIT vs. UNIQA Insurance Group
Performance |
| Timeline |
| American Tower REIT |
| UNIQA Insurance Group |
American Tower and UNIQA Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Tower and UNIQA Insurance
The main advantage of trading using opposite American Tower and UNIQA Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Tower position performs unexpectedly, UNIQA Insurance 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 UNIQA Insurance will offset losses from the drop in UNIQA Insurance's long position.| American Tower vs. UNIQA Insurance Group | American Tower vs. Neometals | American Tower vs. Silvercorp Metals | American Tower vs. Bisichi Mining PLC |
| UNIQA Insurance vs. Prudential Financial | UNIQA Insurance vs. Norman Broadbent Plc | UNIQA Insurance vs. Ross Stores | UNIQA Insurance vs. Cembra Money Bank |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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