Correlation Between UNITED UTILITIES and Schneider Electric
Can any of the company-specific risk be diversified away by investing in both UNITED UTILITIES and Schneider Electric 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 UNITED UTILITIES and Schneider Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UNITED UTILITIES GR and Schneider Electric SE, you can compare the effects of market volatilities on UNITED UTILITIES and Schneider Electric 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 Schneider Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNITED UTILITIES and Schneider Electric.
Diversification Opportunities for UNITED UTILITIES and Schneider Electric
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between UNITED and Schneider is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding UNITED UTILITIES GR and Schneider Electric SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schneider Electric 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 Schneider Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schneider Electric has no effect on the direction of UNITED UTILITIES i.e., UNITED UTILITIES and Schneider Electric go up and down completely randomly.
Pair Corralation between UNITED UTILITIES and Schneider Electric
Assuming the 90 days trading horizon UNITED UTILITIES GR is expected to generate 0.95 times more return on investment than Schneider Electric. However, UNITED UTILITIES GR is 1.05 times less risky than Schneider Electric. It trades about 0.08 of its potential returns per unit of risk. Schneider Electric SE is currently generating about 0.05 per unit of risk. If you would invest 1,152 in UNITED UTILITIES GR on September 2, 2024 and sell it today you would earn a total of 188.00 from holding UNITED UTILITIES GR or generate 16.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
UNITED UTILITIES GR vs. Schneider Electric SE
Performance |
| Timeline |
| UNITED UTILITIES |
| Schneider Electric |
UNITED UTILITIES and Schneider Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UNITED UTILITIES and Schneider Electric
The main advantage of trading using opposite UNITED UTILITIES and Schneider Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNITED UTILITIES position performs unexpectedly, Schneider Electric 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 Schneider Electric will offset losses from the drop in Schneider Electric's long position.| UNITED UTILITIES vs. SIVERS SEMICONDUCTORS AB | UNITED UTILITIES vs. Darden Restaurants | UNITED UTILITIES vs. Reliance Steel Aluminum | UNITED UTILITIES vs. Q2M Managementberatung AG |
| Schneider Electric vs. Goosehead Insurance | Schneider Electric vs. The Hanover Insurance | Schneider Electric vs. Reinsurance Group of | Schneider Electric vs. SIDETRADE EO 1 |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |