Correlation Between CVR Energy and Uniper SE
Can any of the company-specific risk be diversified away by investing in both CVR Energy and Uniper SE 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 CVR Energy and Uniper SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVR Energy and Uniper SE, you can compare the effects of market volatilities on CVR Energy and Uniper SE 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 CVR Energy with a short position of Uniper SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVR Energy and Uniper SE.
Diversification Opportunities for CVR Energy and Uniper SE
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CVR and Uniper is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding CVR Energy and Uniper SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uniper SE and CVR Energy 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 CVR Energy are associated (or correlated) with Uniper SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uniper SE has no effect on the direction of CVR Energy i.e., CVR Energy and Uniper SE go up and down completely randomly.
Pair Corralation between CVR Energy and Uniper SE
Assuming the 90 days trading horizon CVR Energy is expected to under-perform the Uniper SE. But the stock apears to be less risky and, when comparing its historical volatility, CVR Energy is 1.37 times less risky than Uniper SE. The stock trades about -0.01 of its potential returns per unit of risk. The Uniper SE is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 6,014 in Uniper SE on September 2, 2024 and sell it today you would lose (1,695) from holding Uniper SE or give up 28.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 84.8% |
| Values | Daily Returns |
CVR Energy vs. Uniper SE
Performance |
| Timeline |
| CVR Energy |
| Uniper SE |
CVR Energy and Uniper SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVR Energy and Uniper SE
The main advantage of trading using opposite CVR Energy and Uniper SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVR Energy position performs unexpectedly, Uniper SE 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 Uniper SE will offset losses from the drop in Uniper SE's long position.| CVR Energy vs. Uniper SE | CVR Energy vs. Mulberry Group PLC | CVR Energy vs. London Security Plc | CVR Energy vs. Triad Group PLC |
| Uniper SE vs. Roebuck Food Group | Uniper SE vs. Sealed Air Corp | Uniper SE vs. Hilton Food Group | Uniper SE vs. Ryanair Holdings 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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