Correlation Between Unilever PLC and Inter Parfums
Can any of the company-specific risk be diversified away by investing in both Unilever PLC and Inter Parfums 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 Inter Parfums into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unilever PLC and Inter Parfums, you can compare the effects of market volatilities on Unilever PLC and Inter Parfums 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 Inter Parfums. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unilever PLC and Inter Parfums.
Diversification Opportunities for Unilever PLC and Inter Parfums
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Unilever and Inter is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Unilever PLC and Inter Parfums in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inter Parfums 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 Inter Parfums. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inter Parfums has no effect on the direction of Unilever PLC i.e., Unilever PLC and Inter Parfums go up and down completely randomly.
Pair Corralation between Unilever PLC and Inter Parfums
Assuming the 90 days horizon Unilever PLC is expected to under-perform the Inter Parfums. In addition to that, Unilever PLC is 1.66 times more volatile than Inter Parfums. It trades about -0.08 of its total potential returns per unit of risk. Inter Parfums is currently generating about 0.27 per unit of volatility. If you would invest 12,441 in Inter Parfums on August 28, 2024 and sell it today you would earn a total of 1,398 from holding Inter Parfums or generate 11.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Unilever PLC vs. Inter Parfums
Performance |
| Timeline |
| Unilever PLC |
| Inter Parfums |
Unilever PLC and Inter Parfums Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unilever PLC and Inter Parfums
The main advantage of trading using opposite Unilever PLC and Inter Parfums positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unilever PLC position performs unexpectedly, Inter Parfums 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 Inter Parfums will offset losses from the drop in Inter Parfums' long position.| Unilever PLC vs. LOreal Co ADR | Unilever PLC vs. Estee Lauder Companies | Unilever PLC vs. Church Dwight | Unilever PLC vs. LOral SA |
| Inter Parfums vs. J J Snack | Inter Parfums vs. John B Sanfilippo | Inter Parfums vs. Innospec | Inter Parfums vs. Independent 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |