Correlation Between Philip Morris and UNIQA Insurance
Can any of the company-specific risk be diversified away by investing in both Philip Morris 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 Philip Morris and UNIQA Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Philip Morris CR and UNIQA Insurance Group, you can compare the effects of market volatilities on Philip Morris 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 Philip Morris with a short position of UNIQA Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Philip Morris and UNIQA Insurance.
Diversification Opportunities for Philip Morris and UNIQA Insurance
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Philip and UNIQA is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Philip Morris CR 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 Philip Morris 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 Philip Morris CR 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 Philip Morris i.e., Philip Morris and UNIQA Insurance go up and down completely randomly.
Pair Corralation between Philip Morris and UNIQA Insurance
Assuming the 90 days trading horizon Philip Morris CR is expected to generate 1.2 times more return on investment than UNIQA Insurance. However, Philip Morris is 1.2 times more volatile than UNIQA Insurance Group. It trades about 0.07 of its potential returns per unit of risk. UNIQA Insurance Group is currently generating about 0.0 per unit of risk. If you would invest 1,606,000 in Philip Morris CR on August 29, 2024 and sell it today you would earn a total of 14,000 from holding Philip Morris CR or generate 0.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Philip Morris CR vs. UNIQA Insurance Group
Performance |
| Timeline |
| Philip Morris CR |
| UNIQA Insurance Group |
Philip Morris and UNIQA Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Philip Morris and UNIQA Insurance
The main advantage of trading using opposite Philip Morris and UNIQA Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Philip Morris 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.| Philip Morris vs. Cez AS | Philip Morris vs. HARDWARIO as | Philip Morris vs. Prabos Plus as | Philip Morris vs. Kofola CeskoSlovensko as |
| UNIQA Insurance vs. Cez AS | UNIQA Insurance vs. MT 1997 AS | UNIQA Insurance vs. Kofola CeskoSlovensko as | UNIQA Insurance vs. HARDWARIO as |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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