Correlation Between Uniper SE and Beazer Homes
Can any of the company-specific risk be diversified away by investing in both Uniper SE and Beazer Homes 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 Beazer Homes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uniper SE and Beazer Homes USA, you can compare the effects of market volatilities on Uniper SE and Beazer Homes 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 Beazer Homes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniper SE and Beazer Homes.
Diversification Opportunities for Uniper SE and Beazer Homes
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Uniper and Beazer is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Uniper SE and Beazer Homes USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beazer Homes USA 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 Beazer Homes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beazer Homes USA has no effect on the direction of Uniper SE i.e., Uniper SE and Beazer Homes go up and down completely randomly.
Pair Corralation between Uniper SE and Beazer Homes
Assuming the 90 days trading horizon Uniper SE is expected to under-perform the Beazer Homes. But the stock apears to be less risky and, when comparing its historical volatility, Uniper SE is 1.03 times less risky than Beazer Homes. The stock trades about 0.0 of its potential returns per unit of risk. The Beazer Homes USA is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,311 in Beazer Homes USA on September 23, 2024 and sell it today you would earn a total of 1,516 from holding Beazer Homes USA or generate 115.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 58.37% |
Values | Daily Returns |
Uniper SE vs. Beazer Homes USA
Performance |
Timeline |
Uniper SE |
Beazer Homes USA |
Uniper SE and Beazer Homes Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Uniper SE and Beazer Homes
The main advantage of trading using opposite Uniper SE and Beazer Homes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniper SE position performs unexpectedly, Beazer Homes 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 Beazer Homes will offset losses from the drop in Beazer Homes' long position.Uniper SE vs. Mulberry Group PLC | Uniper SE vs. London Security Plc | Uniper SE vs. Triad Group PLC | Uniper SE vs. SURETRACK MON |
Beazer Homes vs. Uniper SE | Beazer Homes vs. Mulberry Group PLC | Beazer Homes vs. London Security Plc | Beazer Homes vs. Triad Group PLC |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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