Correlation Between UNIQA Insurance and Travel Leisure

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

By analyzing existing cross correlation between UNIQA Insurance Group and Travel Leisure Co, you can compare the effects of market volatilities on UNIQA Insurance and Travel Leisure 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 UNIQA Insurance with a short position of Travel Leisure. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQA Insurance and Travel Leisure.

Diversification Opportunities for UNIQA Insurance and Travel Leisure

-0.02

Correlation Coefficient

UNIQA Insurance  Travel Leisure

Good diversification

The 3 months correlation between UNIQA and Travel is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA Insurance Group and Travel Leisure Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Travel Leisure and UNIQA Insurance 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 UNIQA Insurance Group are associated (or correlated) with Travel Leisure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Travel Leisure has no effect on the direction of UNIQA Insurance i.e., UNIQA Insurance and Travel Leisure go up and down completely randomly.

Pair Corralation between UNIQA Insurance and Travel Leisure

Assuming the 90 days trading horizon UNIQA Insurance Group is expected to generate 0.84 times more return on investment than Travel Leisure. However, UNIQA Insurance Group is 1.18 times less risky than Travel Leisure. It trades about 0.05 of its potential returns per unit of risk. Travel Leisure Co is currently generating about 0.02 per unit of risk. If you would invest  668.00  in UNIQA Insurance Group on October 11, 2024 and sell it today you would earn a total of  124.00  from holding UNIQA Insurance Group or generate 18.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.79%
Values	Daily Returns

UNIQA Insurance Group  vs.  Travel Leisure Co

UNIQA Insurance Group

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in UNIQA Insurance Group are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, UNIQA Insurance may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Travel Leisure

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Travel Leisure Co are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Travel Leisure is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with UNIQA Insurance and Travel Leisure

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

The idea behind UNIQA Insurance Group and Travel Leisure Co 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.