Correlation Between Gaztransport and UNIQA Insurance
Can any of the company-specific risk be diversified away by investing in both Gaztransport 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 Gaztransport and UNIQA Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport et Technigaz and UNIQA Insurance Group, you can compare the effects of market volatilities on Gaztransport 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 Gaztransport with a short position of UNIQA Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport and UNIQA Insurance.
Diversification Opportunities for Gaztransport and UNIQA Insurance
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Gaztransport and UNIQA is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport et Technigaz 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 Gaztransport 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 Gaztransport et Technigaz 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 Gaztransport i.e., Gaztransport and UNIQA Insurance go up and down completely randomly.
Pair Corralation between Gaztransport and UNIQA Insurance
Assuming the 90 days trading horizon Gaztransport et Technigaz is expected to generate 1.17 times more return on investment than UNIQA Insurance. However, Gaztransport is 1.17 times more volatile than UNIQA Insurance Group. It trades about 0.14 of its potential returns per unit of risk. UNIQA Insurance Group is currently generating about -0.01 per unit of risk. If you would invest 13,340 in Gaztransport et Technigaz on September 2, 2024 and sell it today you would earn a total of 450.00 from holding Gaztransport et Technigaz or generate 3.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport et Technigaz vs. UNIQA Insurance Group
Performance |
| Timeline |
| Gaztransport et Technigaz |
| UNIQA Insurance Group |
Gaztransport and UNIQA Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport and UNIQA Insurance
The main advantage of trading using opposite Gaztransport and UNIQA Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport 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.| Gaztransport vs. Uniper SE | Gaztransport vs. Mulberry Group PLC | Gaztransport vs. London Security Plc | Gaztransport vs. Triad Group PLC |
| UNIQA Insurance vs. Uniper SE | UNIQA Insurance vs. Mulberry Group PLC | UNIQA Insurance vs. London Security Plc | UNIQA Insurance vs. Triad Group 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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