Correlation Between UNIQA INSURANCE and Ultra Clean
Can any of the company-specific risk be diversified away by investing in both UNIQA INSURANCE and Ultra Clean 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 Ultra Clean 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 Ultra Clean Holdings, you can compare the effects of market volatilities on UNIQA INSURANCE and Ultra Clean 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 Ultra Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQA INSURANCE and Ultra Clean.
Diversification Opportunities for UNIQA INSURANCE and Ultra Clean
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between UNIQA and Ultra is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA INSURANCE GR and Ultra Clean Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ultra Clean Holdings 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 Ultra Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ultra Clean Holdings has no effect on the direction of UNIQA INSURANCE i.e., UNIQA INSURANCE and Ultra Clean go up and down completely randomly.
Pair Corralation between UNIQA INSURANCE and Ultra Clean
Assuming the 90 days trading horizon UNIQA INSURANCE GR is expected to generate 0.25 times more return on investment than Ultra Clean. However, UNIQA INSURANCE GR is 3.97 times less risky than Ultra Clean. It trades about 0.3 of its potential returns per unit of risk. Ultra Clean Holdings is currently generating about -0.11 per unit of risk. If you would invest 773.00 in UNIQA INSURANCE GR on November 2, 2024 and sell it today you would earn a total of 34.00 from holding UNIQA INSURANCE GR or generate 4.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
UNIQA INSURANCE GR vs. Ultra Clean Holdings
Performance |
| Timeline |
| UNIQA INSURANCE GR |
| Ultra Clean Holdings |
UNIQA INSURANCE and Ultra Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UNIQA INSURANCE and Ultra Clean
The main advantage of trading using opposite UNIQA INSURANCE and Ultra Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNIQA INSURANCE position performs unexpectedly, Ultra Clean 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 Ultra Clean will offset losses from the drop in Ultra Clean's long position.| UNIQA INSURANCE vs. Dairy Farm International | UNIQA INSURANCE vs. AUST AGRICULTURAL | UNIQA INSURANCE vs. Titan Machinery | UNIQA INSURANCE vs. Federal Agricultural Mortgage |
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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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