Correlation Between Liberty Media and Uniper SE
Can any of the company-specific risk be diversified away by investing in both Liberty Media 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 Liberty Media and Uniper SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Media Corp and Uniper SE, you can compare the effects of market volatilities on Liberty Media 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 Liberty Media with a short position of Uniper SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Media and Uniper SE.
Diversification Opportunities for Liberty Media and Uniper SE
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Liberty and Uniper is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Media Corp and Uniper SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uniper SE and Liberty Media 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 Liberty Media Corp 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 Liberty Media i.e., Liberty Media and Uniper SE go up and down completely randomly.
Pair Corralation between Liberty Media and Uniper SE
Assuming the 90 days trading horizon Liberty Media Corp is expected to under-perform the Uniper SE. But the stock apears to be less risky and, when comparing its historical volatility, Liberty Media Corp is 2.85 times less risky than Uniper SE. The stock trades about -0.19 of its potential returns per unit of risk. The Uniper SE is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 4,092 in Uniper SE on October 15, 2024 and sell it today you would earn a total of 255.00 from holding Uniper SE or generate 6.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Liberty Media Corp vs. Uniper SE
Performance |
| Timeline |
| Liberty Media Corp |
| Uniper SE |
Liberty Media and Uniper SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty Media and Uniper SE
The main advantage of trading using opposite Liberty Media and Uniper SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Media 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.| Liberty Media vs. Taylor Maritime Investments | Liberty Media vs. Lundin Mining Corp | Liberty Media vs. European Metals Holdings | Liberty Media vs. BlackRock Frontiers Investment |
| Uniper SE vs. Aeorema Communications Plc | Uniper SE vs. Eco Animal Health | Uniper SE vs. Cairo Communication SpA | Uniper SE vs. Induction Healthcare 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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