Correlation Between UNIQA INSURANCE and Spirent Communications
Can any of the company-specific risk be diversified away by investing in both UNIQA INSURANCE and Spirent Communications 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 UNIQA INSURANCE and Spirent Communications into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UNIQA INSURANCE GR and Spirent Communications plc, you can compare the effects of market volatilities on UNIQA INSURANCE and Spirent Communications 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 UNIQA INSURANCE with a short position of Spirent Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQA INSURANCE and Spirent Communications.
Diversification Opportunities for UNIQA INSURANCE and Spirent Communications
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between UNIQA and Spirent is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA INSURANCE GR and Spirent Communications plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spirent Communications and UNIQA 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 UNIQA INSURANCE GR are associated (or correlated) with Spirent Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spirent Communications has no effect on the direction of UNIQA INSURANCE i.e., UNIQA INSURANCE and Spirent Communications go up and down completely randomly.
Pair Corralation between UNIQA INSURANCE and Spirent Communications
Assuming the 90 days trading horizon UNIQA INSURANCE GR is expected to generate 0.1 times more return on investment than Spirent Communications. However, UNIQA INSURANCE GR is 9.85 times less risky than Spirent Communications. It trades about 0.93 of its potential returns per unit of risk. Spirent Communications plc is currently generating about -0.1 per unit of risk. If you would invest 766.00 in UNIQA INSURANCE GR on October 26, 2024 and sell it today you would earn a total of 52.00 from holding UNIQA INSURANCE GR or generate 6.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
UNIQA INSURANCE GR vs. Spirent Communications plc
Performance |
| Timeline |
| UNIQA INSURANCE GR |
| Spirent Communications |
UNIQA INSURANCE and Spirent Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UNIQA INSURANCE and Spirent Communications
The main advantage of trading using opposite UNIQA INSURANCE and Spirent Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNIQA INSURANCE position performs unexpectedly, Spirent Communications 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 Spirent Communications will offset losses from the drop in Spirent Communications' long position.| UNIQA INSURANCE vs. Apple Inc | UNIQA INSURANCE vs. Apple Inc | UNIQA INSURANCE vs. Apple Inc | UNIQA INSURANCE vs. Apple Inc |
| Spirent Communications vs. United Utilities Group | Spirent Communications vs. SBM OFFSHORE | Spirent Communications vs. Algonquin Power Utilities | Spirent Communications vs. UNIQA INSURANCE GR |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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