Correlation Between Uniper SE and American Express
Can any of the company-specific risk be diversified away by investing in both Uniper SE and American Express 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 Uniper SE and American Express into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uniper SE and American Express Co, you can compare the effects of market volatilities on Uniper SE and American Express 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 Uniper SE with a short position of American Express. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniper SE and American Express.
Diversification Opportunities for Uniper SE and American Express
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Uniper and American is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Uniper SE and American Express Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Express and Uniper SE 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 Uniper SE are associated (or correlated) with American Express. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Express has no effect on the direction of Uniper SE i.e., Uniper SE and American Express go up and down completely randomly.
Pair Corralation between Uniper SE and American Express
Assuming the 90 days trading horizon Uniper SE is expected to under-perform the American Express. In addition to that, Uniper SE is 2.27 times more volatile than American Express Co. It trades about -0.06 of its total potential returns per unit of risk. American Express Co is currently generating about 0.12 per unit of volatility. If you would invest 16,571 in American Express Co on October 12, 2024 and sell it today you would earn a total of 13,469 from holding American Express Co or generate 81.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.99% |
| Values | Daily Returns |
Uniper SE vs. American Express Co
Performance |
| Timeline |
| Uniper SE |
| American Express |
Uniper SE and American Express Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uniper SE and American Express
The main advantage of trading using opposite Uniper SE and American Express positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniper SE position performs unexpectedly, American Express 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 American Express will offset losses from the drop in American Express' long position.| Uniper SE vs. Accesso Technology Group | Uniper SE vs. Invesco Physical Silver | Uniper SE vs. Sabien Technology Group | Uniper SE vs. Coeur Mining |
| American Express vs. Walmart | American Express vs. BYD Co | American Express vs. Volkswagen AG | American Express vs. Volkswagen AG Non Vtg |
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 Stocks Directory module to find actively traded stocks across global markets.
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