Correlation Between Uniphar Group and Bank of Ireland
Can any of the company-specific risk be diversified away by investing in both Uniphar Group and Bank of Ireland 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 Uniphar Group and Bank of Ireland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uniphar Group PLC and Bank of Ireland, you can compare the effects of market volatilities on Uniphar Group and Bank of Ireland 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 Uniphar Group with a short position of Bank of Ireland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniphar Group and Bank of Ireland.
Diversification Opportunities for Uniphar Group and Bank of Ireland
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Uniphar and Bank is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Uniphar Group PLC and Bank of Ireland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Ireland and Uniphar 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 Uniphar Group PLC are associated (or correlated) with Bank of Ireland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Ireland has no effect on the direction of Uniphar Group i.e., Uniphar Group and Bank of Ireland go up and down completely randomly.
Pair Corralation between Uniphar Group and Bank of Ireland
Assuming the 90 days trading horizon Uniphar Group PLC is expected to under-perform the Bank of Ireland. But the stock apears to be less risky and, when comparing its historical volatility, Uniphar Group PLC is 1.19 times less risky than Bank of Ireland. The stock trades about -0.31 of its potential returns per unit of risk. The Bank of Ireland is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 880.00 in Bank of Ireland on August 28, 2024 and sell it today you would lose (39.00) from holding Bank of Ireland or give up 4.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Uniphar Group PLC vs. Bank of Ireland
Performance |
| Timeline |
| Uniphar Group PLC |
| Bank of Ireland |
Uniphar Group and Bank of Ireland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uniphar Group and Bank of Ireland
The main advantage of trading using opposite Uniphar Group and Bank of Ireland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniphar Group position performs unexpectedly, Bank of Ireland 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 Bank of Ireland will offset losses from the drop in Bank of Ireland's long position.| Uniphar Group vs. Dalata Hotel Group | Uniphar Group vs. Kingspan Group plc | Uniphar Group vs. AIB Group PLC | Uniphar Group vs. Glanbia PLC |
| Bank of Ireland vs. AIB Group PLC | Bank of Ireland vs. Kingspan Group plc | Bank of Ireland vs. Glanbia PLC | Bank of Ireland vs. Ryanair Holdings plc |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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