Correlation Between Unifiedpost Group and Elia Group
Can any of the company-specific risk be diversified away by investing in both Unifiedpost Group and Elia Group 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 Unifiedpost Group and Elia Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unifiedpost Group SA and Elia Group SANV, you can compare the effects of market volatilities on Unifiedpost Group and Elia Group 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 Unifiedpost Group with a short position of Elia Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unifiedpost Group and Elia Group.
Diversification Opportunities for Unifiedpost Group and Elia Group
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Unifiedpost and Elia is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Unifiedpost Group SA and Elia Group SANV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elia Group SANV and Unifiedpost Group 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 Unifiedpost Group SA are associated (or correlated) with Elia Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elia Group SANV has no effect on the direction of Unifiedpost Group i.e., Unifiedpost Group and Elia Group go up and down completely randomly.
Pair Corralation between Unifiedpost Group and Elia Group
Assuming the 90 days trading horizon Unifiedpost Group SA is expected to under-perform the Elia Group. In addition to that, Unifiedpost Group is 1.25 times more volatile than Elia Group SANV. It trades about -0.34 of its total potential returns per unit of risk. Elia Group SANV is currently generating about -0.11 per unit of volatility. If you would invest 9,220 in Elia Group SANV on August 25, 2024 and sell it today you would lose (500.00) from holding Elia Group SANV or give up 5.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Unifiedpost Group SA vs. Elia Group SANV
Performance |
| Timeline |
| Unifiedpost Group |
| Elia Group SANV |
Unifiedpost Group and Elia Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unifiedpost Group and Elia Group
The main advantage of trading using opposite Unifiedpost Group and Elia Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unifiedpost Group position performs unexpectedly, Elia Group 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 Elia Group will offset losses from the drop in Elia Group's long position.| Unifiedpost Group vs. Exmar NV | Unifiedpost Group vs. Ontex Group NV | Unifiedpost Group vs. X Fab Silicon | Unifiedpost Group vs. VGP NV |
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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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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