Correlation Between Unilever PLC and AT S
Can any of the company-specific risk be diversified away by investing in both Unilever PLC and AT S 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 Unilever PLC and AT S into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unilever PLC and AT S Austria, you can compare the effects of market volatilities on Unilever PLC and AT S 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 Unilever PLC with a short position of AT S. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unilever PLC and AT S.
Diversification Opportunities for Unilever PLC and AT S
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Unilever and ATS is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Unilever PLC and AT S Austria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AT S Austria and Unilever PLC 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 Unilever PLC are associated (or correlated) with AT S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AT S Austria has no effect on the direction of Unilever PLC i.e., Unilever PLC and AT S go up and down completely randomly.
Pair Corralation between Unilever PLC and AT S
Assuming the 90 days trading horizon Unilever PLC is expected to generate 0.29 times more return on investment than AT S. However, Unilever PLC is 3.43 times less risky than AT S. It trades about -0.09 of its potential returns per unit of risk. AT S Austria is currently generating about -0.52 per unit of risk. If you would invest 5,762 in Unilever PLC on August 29, 2024 and sell it today you would lose (116.00) from holding Unilever PLC or give up 2.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Unilever PLC vs. AT S Austria
Performance |
| Timeline |
| Unilever PLC |
| AT S Austria |
Unilever PLC and AT S Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unilever PLC and AT S
The main advantage of trading using opposite Unilever PLC and AT S positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unilever PLC position performs unexpectedly, AT S 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 AT S will offset losses from the drop in AT S's long position.| Unilever PLC vs. The Este Lauder | Unilever PLC vs. RATH Aktiengesellschaft | Unilever PLC vs. AT S Austria | Unilever PLC vs. BAWAG Group AG |
| AT S vs. Voestalpine AG | AT S vs. Lenzing Aktiengesellschaft | AT S vs. Andritz AG | AT S vs. OMV Aktiengesellschaft |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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