Correlation Between Arcontech Group and United Internet
Can any of the company-specific risk be diversified away by investing in both Arcontech Group and United Internet 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 Arcontech Group and United Internet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arcontech Group Plc and United Internet AG, you can compare the effects of market volatilities on Arcontech Group and United Internet 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 Arcontech Group with a short position of United Internet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arcontech Group and United Internet.
Diversification Opportunities for Arcontech Group and United Internet
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Arcontech and United is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Arcontech Group Plc and United Internet AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Internet AG and Arcontech Group 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 Arcontech Group Plc are associated (or correlated) with United Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Internet AG has no effect on the direction of Arcontech Group i.e., Arcontech Group and United Internet go up and down completely randomly.
Pair Corralation between Arcontech Group and United Internet
Assuming the 90 days trading horizon Arcontech Group Plc is expected to under-perform the United Internet. But the stock apears to be less risky and, when comparing its historical volatility, Arcontech Group Plc is 1.48 times less risky than United Internet. The stock trades about -0.33 of its potential returns per unit of risk. The United Internet AG is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,544 in United Internet AG on November 2, 2024 and sell it today you would earn a total of 90.00 from holding United Internet AG or generate 5.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Arcontech Group Plc vs. United Internet AG
Performance |
| Timeline |
| Arcontech Group Plc |
| United Internet AG |
Arcontech Group and United Internet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arcontech Group and United Internet
The main advantage of trading using opposite Arcontech Group and United Internet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arcontech Group position performs unexpectedly, United Internet 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 United Internet will offset losses from the drop in United Internet's long position.| Arcontech Group vs. China Pacific Insurance | Arcontech Group vs. Cairo Communication SpA | Arcontech Group vs. Spirent Communications plc | Arcontech Group vs. Verizon Communications |
| United Internet vs. URU Metals | United Internet vs. Associated British Foods | United Internet vs. Golden Metal Resources | United Internet vs. Gear4music 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |