Correlation Between N Leventeris and Unibios Holdings

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

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

Diversification Opportunities for N Leventeris and Unibios Holdings

0.08

Correlation Coefficient

N Leventeris  Unibios Holdings

Significant diversification

The 3 months correlation between LEBEP and Unibios is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding N Leventeris SA and Unibios Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unibios Holdings and N Leventeris 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 N Leventeris SA are associated (or correlated) with Unibios Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unibios Holdings has no effect on the direction of N Leventeris i.e., N Leventeris and Unibios Holdings go up and down completely randomly.

Pair Corralation between N Leventeris and Unibios Holdings

Assuming the 90 days trading horizon N Leventeris SA is expected to under-perform the Unibios Holdings. In addition to that, N Leventeris is 4.19 times more volatile than Unibios Holdings SA. It trades about -0.03 of its total potential returns per unit of risk. Unibios Holdings SA is currently generating about -0.07 per unit of volatility. If you would invest  160.00  in Unibios Holdings SA on December 31, 2024 and sell it today you would lose (9.00) from holding Unibios Holdings SA or give up 5.62% of portfolio value over 90 days.

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

N Leventeris SA  vs.  Unibios Holdings SA

N Leventeris SA

Risk-Adjusted Performance

Very Weak

Over the last 90 days N Leventeris SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Unibios Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Unibios Holdings SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Unibios Holdings is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with N Leventeris and Unibios Holdings

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

The idea behind N Leventeris SA and Unibios Holdings SA 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.