Correlation Between Skandinaviska Enskilda and UniCredit SpA
Can any of the company-specific risk be diversified away by investing in both Skandinaviska Enskilda 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 Skandinaviska Enskilda and UniCredit SpA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Skandinaviska Enskilda Banken and UniCredit SpA, you can compare the effects of market volatilities on Skandinaviska Enskilda 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 Skandinaviska Enskilda with a short position of UniCredit SpA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Skandinaviska Enskilda and UniCredit SpA.
Diversification Opportunities for Skandinaviska Enskilda and UniCredit SpA
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Skandinaviska and UniCredit is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Skandinaviska Enskilda Banken and UniCredit SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UniCredit SpA and Skandinaviska Enskilda 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 Skandinaviska Enskilda Banken 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 Skandinaviska Enskilda i.e., Skandinaviska Enskilda and UniCredit SpA go up and down completely randomly.
Pair Corralation between Skandinaviska Enskilda and UniCredit SpA
Assuming the 90 days trading horizon Skandinaviska Enskilda Banken is expected to generate 0.76 times more return on investment than UniCredit SpA. However, Skandinaviska Enskilda Banken is 1.32 times less risky than UniCredit SpA. It trades about -0.12 of its potential returns per unit of risk. UniCredit SpA is currently generating about -0.19 per unit of risk. If you would invest 1,346 in Skandinaviska Enskilda Banken on August 31, 2024 and sell it today you would lose (64.00) from holding Skandinaviska Enskilda Banken or give up 4.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Skandinaviska Enskilda Banken vs. UniCredit SpA
Performance |
| Timeline |
| Skandinaviska Enskilda |
| UniCredit SpA |
Skandinaviska Enskilda and UniCredit SpA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Skandinaviska Enskilda and UniCredit SpA
The main advantage of trading using opposite Skandinaviska Enskilda and UniCredit SpA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Skandinaviska Enskilda 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.| Skandinaviska Enskilda vs. Skandinaviska Enskilda Banken | Skandinaviska Enskilda vs. Hang Seng Bank | Skandinaviska Enskilda vs. United Overseas Bank | Skandinaviska Enskilda vs. China Resources Land |
| UniCredit SpA vs. Heartland Financial USA | UniCredit SpA vs. QBE Insurance Group | UniCredit SpA vs. Commonwealth Bank of | UniCredit SpA vs. THORNEY TECHS LTD |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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