Correlation Between INTER CARS and UNIQA INSURANCE
Can any of the company-specific risk be diversified away by investing in both INTER CARS 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 INTER CARS and UNIQA INSURANCE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTER CARS SA and UNIQA INSURANCE GR, you can compare the effects of market volatilities on INTER CARS 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 INTER CARS with a short position of UNIQA INSURANCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTER CARS and UNIQA INSURANCE.
Diversification Opportunities for INTER CARS and UNIQA INSURANCE
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between INTER and UNIQA is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding INTER CARS SA and UNIQA INSURANCE GR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNIQA INSURANCE GR and INTER CARS 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 INTER CARS SA 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 GR has no effect on the direction of INTER CARS i.e., INTER CARS and UNIQA INSURANCE go up and down completely randomly.
Pair Corralation between INTER CARS and UNIQA INSURANCE
Assuming the 90 days horizon INTER CARS SA is expected to generate 2.01 times more return on investment than UNIQA INSURANCE. However, INTER CARS is 2.01 times more volatile than UNIQA INSURANCE GR. It trades about 0.06 of its potential returns per unit of risk. UNIQA INSURANCE GR is currently generating about 0.05 per unit of risk. If you would invest 12,040 in INTER CARS SA on November 2, 2024 and sell it today you would earn a total of 1,120 from holding INTER CARS SA or generate 9.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
INTER CARS SA vs. UNIQA INSURANCE GR
Performance |
| Timeline |
| INTER CARS SA |
| UNIQA INSURANCE GR |
INTER CARS and UNIQA INSURANCE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTER CARS and UNIQA INSURANCE
The main advantage of trading using opposite INTER CARS and UNIQA INSURANCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTER CARS 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.| INTER CARS vs. Cardinal Health | INTER CARS vs. National Health Investors | INTER CARS vs. Chunghwa Telecom Co | INTER CARS vs. HEALTHSTREAM |
| UNIQA INSURANCE vs. Dairy Farm International | UNIQA INSURANCE vs. AUST AGRICULTURAL | UNIQA INSURANCE vs. Titan Machinery | UNIQA INSURANCE vs. Federal Agricultural Mortgage |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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