Correlation Between Sabre Insurance and UNIQA Insurance
Can any of the company-specific risk be diversified away by investing in both Sabre Insurance 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 Sabre Insurance and UNIQA Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabre Insurance Group and UNIQA Insurance Group, you can compare the effects of market volatilities on Sabre Insurance 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 Sabre Insurance with a short position of UNIQA Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabre Insurance and UNIQA Insurance.
Diversification Opportunities for Sabre Insurance and UNIQA Insurance
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sabre and UNIQA is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Sabre Insurance Group 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 Sabre Insurance 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 Sabre Insurance Group 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 Sabre Insurance i.e., Sabre Insurance and UNIQA Insurance go up and down completely randomly.
Pair Corralation between Sabre Insurance and UNIQA Insurance
Assuming the 90 days trading horizon Sabre Insurance Group is expected to generate 2.31 times more return on investment than UNIQA Insurance. However, Sabre Insurance is 2.31 times more volatile than UNIQA Insurance Group. It trades about 0.04 of its potential returns per unit of risk. UNIQA Insurance Group is currently generating about 0.05 per unit of risk. If you would invest 9,699 in Sabre Insurance Group on September 3, 2024 and sell it today you would earn a total of 3,421 from holding Sabre Insurance Group or generate 35.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.59% |
| Values | Daily Returns |
Sabre Insurance Group vs. UNIQA Insurance Group
Performance |
| Timeline |
| Sabre Insurance Group |
| UNIQA Insurance Group |
Sabre Insurance and UNIQA Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabre Insurance and UNIQA Insurance
The main advantage of trading using opposite Sabre Insurance and UNIQA Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabre Insurance 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.| Sabre Insurance vs. McEwen Mining | Sabre Insurance vs. United Internet AG | Sabre Insurance vs. Universal Display Corp | Sabre Insurance vs. GoldMining |
| 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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