Correlation Between Prudential Financial and UNIQA Insurance
Can any of the company-specific risk be diversified away by investing in both Prudential Financial 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 Prudential Financial and UNIQA Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prudential Financial and UNIQA Insurance Group, you can compare the effects of market volatilities on Prudential Financial 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 Prudential Financial with a short position of UNIQA Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prudential Financial and UNIQA Insurance.
Diversification Opportunities for Prudential Financial and UNIQA Insurance
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Prudential and UNIQA is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Prudential Financial 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 Prudential Financial 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 Prudential Financial 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 Prudential Financial i.e., Prudential Financial and UNIQA Insurance go up and down completely randomly.
Pair Corralation between Prudential Financial and UNIQA Insurance
Assuming the 90 days trading horizon Prudential Financial is expected to generate 2.17 times more return on investment than UNIQA Insurance. However, Prudential Financial is 2.17 times more volatile than UNIQA Insurance Group. It trades about 0.07 of its potential returns per unit of risk. UNIQA Insurance Group is currently generating about 0.02 per unit of risk. If you would invest 8,803 in Prudential Financial on September 12, 2024 and sell it today you would earn a total of 3,316 from holding Prudential Financial or generate 37.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.15% |
| Values | Daily Returns |
Prudential Financial vs. UNIQA Insurance Group
Performance |
| Timeline |
| Prudential Financial |
| UNIQA Insurance Group |
Prudential Financial and UNIQA Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prudential Financial and UNIQA Insurance
The main advantage of trading using opposite Prudential Financial and UNIQA Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prudential Financial 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.| Prudential Financial vs. Hong Kong Land | Prudential Financial vs. Neometals | Prudential Financial vs. Coor Service Management | Prudential Financial vs. Fidelity Sustainable USD |
| 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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