Correlation Between UF Games and Centrum Finansowe
Can any of the company-specific risk be diversified away by investing in both UF Games and Centrum Finansowe 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 UF Games and Centrum Finansowe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UF Games SA and Centrum Finansowe Banku, you can compare the effects of market volatilities on UF Games and Centrum Finansowe 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 UF Games with a short position of Centrum Finansowe. Check out your portfolio center. Please also check ongoing floating volatility patterns of UF Games and Centrum Finansowe.
Diversification Opportunities for UF Games and Centrum Finansowe
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between UFG and Centrum is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding UF Games SA and Centrum Finansowe Banku in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Centrum Finansowe Banku and UF Games 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 UF Games SA are associated (or correlated) with Centrum Finansowe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Centrum Finansowe Banku has no effect on the direction of UF Games i.e., UF Games and Centrum Finansowe go up and down completely randomly.
Pair Corralation between UF Games and Centrum Finansowe
Assuming the 90 days trading horizon UF Games SA is expected to under-perform the Centrum Finansowe. In addition to that, UF Games is 1.2 times more volatile than Centrum Finansowe Banku. It trades about -0.08 of its total potential returns per unit of risk. Centrum Finansowe Banku is currently generating about 0.05 per unit of volatility. If you would invest 347.00 in Centrum Finansowe Banku on August 27, 2024 and sell it today you would earn a total of 198.00 from holding Centrum Finansowe Banku or generate 57.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 79.6% |
| Values | Daily Returns |
UF Games SA vs. Centrum Finansowe Banku
Performance |
| Timeline |
| UF Games SA |
| Centrum Finansowe Banku |
UF Games and Centrum Finansowe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UF Games and Centrum Finansowe
The main advantage of trading using opposite UF Games and Centrum Finansowe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UF Games position performs unexpectedly, Centrum Finansowe 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 Centrum Finansowe will offset losses from the drop in Centrum Finansowe's long position.| UF Games vs. Banco Santander SA | UF Games vs. UniCredit SpA | UF Games vs. CEZ as | UF Games vs. Polski Koncern Naftowy |
| Centrum Finansowe vs. Carlson Investments SA | Centrum Finansowe vs. Asseco Business Solutions | Centrum Finansowe vs. Detalion Games SA | Centrum Finansowe vs. Asseco South Eastern |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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