Correlation Between MOL Hungarian and UNIQA Insurance
Can any of the company-specific risk be diversified away by investing in both MOL Hungarian 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 MOL Hungarian and UNIQA Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MOL Hungarian Oil and UNIQA Insurance Group, you can compare the effects of market volatilities on MOL Hungarian 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 MOL Hungarian with a short position of UNIQA Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOL Hungarian and UNIQA Insurance.
Diversification Opportunities for MOL Hungarian and UNIQA Insurance
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between MOL and UNIQA is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding MOL Hungarian Oil 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 MOL Hungarian 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 MOL Hungarian Oil 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 MOL Hungarian i.e., MOL Hungarian and UNIQA Insurance go up and down completely randomly.
Pair Corralation between MOL Hungarian and UNIQA Insurance
Assuming the 90 days trading horizon MOL Hungarian Oil is expected to generate 3.18 times more return on investment than UNIQA Insurance. However, MOL Hungarian is 3.18 times more volatile than UNIQA Insurance Group. It trades about 0.01 of its potential returns per unit of risk. UNIQA Insurance Group is currently generating about -0.12 per unit of risk. If you would invest 292,200 in MOL Hungarian Oil on September 3, 2024 and sell it today you would earn a total of 0.00 from holding MOL Hungarian Oil or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MOL Hungarian Oil vs. UNIQA Insurance Group
Performance |
| Timeline |
| MOL Hungarian Oil |
| UNIQA Insurance Group |
MOL Hungarian and UNIQA Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOL Hungarian and UNIQA Insurance
The main advantage of trading using opposite MOL Hungarian and UNIQA Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOL Hungarian 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.| MOL Hungarian vs. UNIQA Insurance Group | MOL Hungarian vs. Take Two Interactive Software | MOL Hungarian vs. Tatton Asset Management | MOL Hungarian vs. Synchrony Financial |
| UNIQA Insurance vs. Panther Metals PLC | UNIQA Insurance vs. McEwen Mining | UNIQA Insurance vs. Molson Coors Beverage | UNIQA Insurance vs. Central Asia Metals |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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