Correlation Between UNITED UTILITIES and Hannover Rck
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By analyzing existing cross correlation between UNITED UTILITIES GR and Hannover Rck SE, you can compare the effects of market volatilities on UNITED UTILITIES and Hannover Rck 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 UNITED UTILITIES with a short position of Hannover Rck. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNITED UTILITIES and Hannover Rck.
Diversification Opportunities for UNITED UTILITIES and Hannover Rck
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between UNITED and Hannover is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding UNITED UTILITIES GR and Hannover Rck SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hannover Rck SE and UNITED UTILITIES 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 UNITED UTILITIES GR are associated (or correlated) with Hannover Rck. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hannover Rck SE has no effect on the direction of UNITED UTILITIES i.e., UNITED UTILITIES and Hannover Rck go up and down completely randomly.
Pair Corralation between UNITED UTILITIES and Hannover Rck
Assuming the 90 days trading horizon UNITED UTILITIES GR is expected to generate 1.39 times more return on investment than Hannover Rck. However, UNITED UTILITIES is 1.39 times more volatile than Hannover Rck SE. It trades about 0.12 of its potential returns per unit of risk. Hannover Rck SE is currently generating about 0.13 per unit of risk. If you would invest 1,254 in UNITED UTILITIES GR on September 12, 2024 and sell it today you would earn a total of 46.00 from holding UNITED UTILITIES GR or generate 3.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
UNITED UTILITIES GR vs. Hannover Rck SE
Performance |
| Timeline |
| UNITED UTILITIES |
| Hannover Rck SE |
UNITED UTILITIES and Hannover Rck Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UNITED UTILITIES and Hannover Rck
The main advantage of trading using opposite UNITED UTILITIES and Hannover Rck positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNITED UTILITIES position performs unexpectedly, Hannover Rck 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 Hannover Rck will offset losses from the drop in Hannover Rck's long position.| UNITED UTILITIES vs. Apple Inc | UNITED UTILITIES vs. Apple Inc | UNITED UTILITIES vs. Apple Inc | UNITED UTILITIES vs. Apple Inc |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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