Correlation Between UniCredit SpA and Swedbank
Can any of the company-specific risk be diversified away by investing in both UniCredit SpA and Swedbank 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 UniCredit SpA and Swedbank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UniCredit SpA ADR and Swedbank AB, you can compare the effects of market volatilities on UniCredit SpA and Swedbank 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 UniCredit SpA with a short position of Swedbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of UniCredit SpA and Swedbank.
Diversification Opportunities for UniCredit SpA and Swedbank
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between UniCredit and Swedbank is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding UniCredit SpA ADR and Swedbank AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swedbank AB and UniCredit SpA 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 UniCredit SpA ADR are associated (or correlated) with Swedbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swedbank AB has no effect on the direction of UniCredit SpA i.e., UniCredit SpA and Swedbank go up and down completely randomly.
Pair Corralation between UniCredit SpA and Swedbank
Assuming the 90 days horizon UniCredit SpA ADR is expected to generate 1.19 times more return on investment than Swedbank. However, UniCredit SpA is 1.19 times more volatile than Swedbank AB. It trades about 0.05 of its potential returns per unit of risk. Swedbank AB is currently generating about -0.09 per unit of risk. If you would invest 2,030 in UniCredit SpA ADR on August 24, 2024 and sell it today you would earn a total of 92.00 from holding UniCredit SpA ADR or generate 4.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
UniCredit SpA ADR vs. Swedbank AB
Performance |
| Timeline |
| UniCredit SpA ADR |
| Swedbank AB |
UniCredit SpA and Swedbank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UniCredit SpA and Swedbank
The main advantage of trading using opposite UniCredit SpA and Swedbank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UniCredit SpA position performs unexpectedly, Swedbank 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 Swedbank will offset losses from the drop in Swedbank's long position.| UniCredit SpA vs. Banco Do Brasil | UniCredit SpA vs. Societe Generale ADR | UniCredit SpA vs. BNP Paribas SA | UniCredit SpA vs. Credit Agricole SA |
| Swedbank vs. United Overseas Bank | Swedbank vs. KBC Groep NV | Swedbank vs. Jyske Bank AS | Swedbank vs. Israel Discount Bank |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities |