Correlation Between Uniper SE and Atos SE

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

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

Diversification Opportunities for Uniper SE and Atos SE

-0.15

Correlation Coefficient

Uniper SE  Atos SE

Good diversification

The 3 months correlation between Uniper and Atos is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Uniper SE and Atos SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atos SE and Uniper SE 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 Uniper SE are associated (or correlated) with Atos SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atos SE has no effect on the direction of Uniper SE i.e., Uniper SE and Atos SE go up and down completely randomly.

Pair Corralation between Uniper SE and Atos SE

Assuming the 90 days trading horizon Uniper SE is expected to under-perform the Atos SE. But the stock apears to be less risky and, when comparing its historical volatility, Uniper SE is 67.91 times less risky than Atos SE. The stock trades about -0.04 of its potential returns per unit of risk. The Atos SE is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  0.50  in Atos SE on October 15, 2024 and sell it today you would lose (0.27) from holding Atos SE or give up 54.0% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Uniper SE  vs.  Atos SE

Uniper SE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Uniper SE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Uniper SE is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Atos SE

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Atos SE are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Atos SE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Uniper SE and Atos SE

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

The idea behind Uniper SE and Atos SE 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.

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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.