Correlation Between Univar and BASF SE
Can any of the company-specific risk be diversified away by investing in both Univar and BASF SE 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 Univar and BASF SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Univar Inc and BASF SE ADR, you can compare the effects of market volatilities on Univar and BASF SE 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 Univar with a short position of BASF SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Univar and BASF SE.
Diversification Opportunities for Univar and BASF SE
Pay attention - limited upside
The 3 months correlation between Univar and BASF is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Univar Inc and BASF SE ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BASF SE ADR and Univar 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 Univar Inc are associated (or correlated) with BASF SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BASF SE ADR has no effect on the direction of Univar i.e., Univar and BASF SE go up and down completely randomly.
Pair Corralation between Univar and BASF SE
If you would invest 1,188 in BASF SE ADR on January 11, 2025 and sell it today you would lose (8.00) from holding BASF SE ADR or give up 0.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Univar Inc vs. BASF SE ADR
Performance |
| Timeline |
| Univar Inc |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
| BASF SE ADR |
Univar and BASF SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Univar and BASF SE
The main advantage of trading using opposite Univar and BASF SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Univar position performs unexpectedly, BASF SE 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 BASF SE will offset losses from the drop in BASF SE's long position.| Univar vs. Valhi Inc | Univar vs. Huntsman | Univar vs. Lsb Industries | Univar vs. Westlake Chemical Partners |
| BASF SE vs. Shin Etsu Chemical Co | BASF SE vs. Shin Etsu Chemical Co | BASF SE vs. First Graphene | BASF SE vs. Huntsman |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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