Correlation Between AMAG Austria and UNIQA Insurance
Can any of the company-specific risk be diversified away by investing in both AMAG Austria 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 AMAG Austria and UNIQA Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AMAG Austria Metall and UNIQA Insurance Group, you can compare the effects of market volatilities on AMAG Austria 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 AMAG Austria with a short position of UNIQA Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of AMAG Austria and UNIQA Insurance.
Diversification Opportunities for AMAG Austria and UNIQA Insurance
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between AMAG and UNIQA is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding AMAG Austria Metall 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 AMAG Austria 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 AMAG Austria Metall 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 AMAG Austria i.e., AMAG Austria and UNIQA Insurance go up and down completely randomly.
Pair Corralation between AMAG Austria and UNIQA Insurance
Assuming the 90 days trading horizon AMAG Austria Metall is expected to under-perform the UNIQA Insurance. But the stock apears to be less risky and, when comparing its historical volatility, AMAG Austria Metall is 1.08 times less risky than UNIQA Insurance. The stock trades about -0.4 of its potential returns per unit of risk. The UNIQA Insurance Group is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 736.00 in UNIQA Insurance Group on August 28, 2024 and sell it today you would lose (2.00) from holding UNIQA Insurance Group or give up 0.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AMAG Austria Metall vs. UNIQA Insurance Group
Performance |
| Timeline |
| AMAG Austria Metall |
| UNIQA Insurance Group |
AMAG Austria and UNIQA Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AMAG Austria and UNIQA Insurance
The main advantage of trading using opposite AMAG Austria and UNIQA Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AMAG Austria 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.| AMAG Austria vs. Lenzing Aktiengesellschaft | AMAG Austria vs. Voestalpine AG | AMAG Austria vs. EVN AG | AMAG Austria vs. Facc AG |
| UNIQA Insurance vs. Vienna Insurance Group | UNIQA Insurance vs. Oesterr Post AG | UNIQA Insurance vs. Raiffeisen Bank International | UNIQA Insurance vs. Voestalpine AG |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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