Correlation Between UNIQUE and SFP Tech

Can any of the company-specific risk be diversified away by investing in both UNIQUE and SFP Tech 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 UNIQUE and SFP Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between UNIQUE and SFP Tech Holdings, you can compare the effects of market volatilities on UNIQUE and SFP Tech 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 UNIQUE with a short position of SFP Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQUE and SFP Tech.

Diversification Opportunities for UNIQUE and SFP Tech

-0.05

Correlation Coefficient

UNIQUE  SFP Tech

Good diversification

The 3 months correlation between UNIQUE and SFP is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding UNIQUE and SFP Tech Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SFP Tech Holdings and UNIQUE 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 UNIQUE are associated (or correlated) with SFP Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SFP Tech Holdings has no effect on the direction of UNIQUE i.e., UNIQUE and SFP Tech go up and down completely randomly.

Pair Corralation between UNIQUE and SFP Tech

Assuming the 90 days trading horizon UNIQUE is expected to generate 1.23 times more return on investment than SFP Tech. However, UNIQUE is 1.23 times more volatile than SFP Tech Holdings. It trades about 0.06 of its potential returns per unit of risk. SFP Tech Holdings is currently generating about 0.02 per unit of risk. If you would invest  36.00  in UNIQUE on August 31, 2024 and sell it today you would earn a total of  3.00  from holding UNIQUE or generate 8.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

UNIQUE  vs.  SFP Tech Holdings

UNIQUE

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in UNIQUE are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, UNIQUE may actually be approaching a critical reversion point that can send shares even higher in December 2024.

SFP Tech Holdings

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SFP Tech Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, SFP Tech is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with UNIQUE and SFP Tech

The main advantage of trading using opposite UNIQUE and SFP Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNIQUE position performs unexpectedly, SFP Tech 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 SFP Tech will offset losses from the drop in SFP Tech's long position.

The idea behind UNIQUE and SFP Tech Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.