Correlation Between Cloud Technologies and UniCredit SpA
Can any of the company-specific risk be diversified away by investing in both Cloud Technologies and UniCredit SpA 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 Cloud Technologies and UniCredit SpA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cloud Technologies SA and UniCredit SpA, you can compare the effects of market volatilities on Cloud Technologies and UniCredit SpA 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 Cloud Technologies with a short position of UniCredit SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cloud Technologies and UniCredit SpA.
Diversification Opportunities for Cloud Technologies and UniCredit SpA
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Cloud and UniCredit is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Cloud Technologies SA and UniCredit SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UniCredit SpA and Cloud Technologies 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 Cloud Technologies SA are associated (or correlated) with UniCredit SpA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UniCredit SpA has no effect on the direction of Cloud Technologies i.e., Cloud Technologies and UniCredit SpA go up and down completely randomly.
Pair Corralation between Cloud Technologies and UniCredit SpA
Assuming the 90 days trading horizon Cloud Technologies SA is expected to generate 1.11 times more return on investment than UniCredit SpA. However, Cloud Technologies is 1.11 times more volatile than UniCredit SpA. It trades about -0.04 of its potential returns per unit of risk. UniCredit SpA is currently generating about -0.36 per unit of risk. If you would invest 6,380 in Cloud Technologies SA on September 3, 2024 and sell it today you would lose (180.00) from holding Cloud Technologies SA or give up 2.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 85.0% |
| Values | Daily Returns |
Cloud Technologies SA vs. UniCredit SpA
Performance |
| Timeline |
| Cloud Technologies |
| UniCredit SpA |
Cloud Technologies and UniCredit SpA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cloud Technologies and UniCredit SpA
The main advantage of trading using opposite Cloud Technologies and UniCredit SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cloud Technologies position performs unexpectedly, UniCredit SpA 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 UniCredit SpA will offset losses from the drop in UniCredit SpA's long position.| Cloud Technologies vs. Ailleron SA | Cloud Technologies vs. Asseco Business Solutions | Cloud Technologies vs. Kogeneracja SA | Cloud Technologies vs. Asseco South Eastern |
| UniCredit SpA vs. Gamedust SA | UniCredit SpA vs. Mercator Medical SA | UniCredit SpA vs. Ultimate Games SA | UniCredit SpA vs. Quantum Software SA |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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