Correlation Between UNIQA INSURANCE and Valero Energy

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

By analyzing existing cross correlation between UNIQA INSURANCE GR and Valero Energy, you can compare the effects of market volatilities on UNIQA INSURANCE and Valero Energy 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 Valero Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQA INSURANCE and Valero Energy.

Diversification Opportunities for UNIQA INSURANCE and Valero Energy

-0.07

Correlation Coefficient

UNIQA INSURANCE  Valero Energy

Good diversification

The 3 months correlation between UNIQA and Valero is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA INSURANCE GR and Valero Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Valero Energy 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 GR are associated (or correlated) with Valero Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Valero Energy has no effect on the direction of UNIQA INSURANCE i.e., UNIQA INSURANCE and Valero Energy go up and down completely randomly.

Pair Corralation between UNIQA INSURANCE and Valero Energy

Assuming the 90 days trading horizon UNIQA INSURANCE GR is expected to generate 0.56 times more return on investment than Valero Energy. However, UNIQA INSURANCE GR is 1.79 times less risky than Valero Energy. It trades about 0.28 of its potential returns per unit of risk. Valero Energy is currently generating about 0.08 per unit of risk. If you would invest  768.00  in UNIQA INSURANCE GR on December 22, 2024 and sell it today you would earn a total of  175.00  from holding UNIQA INSURANCE GR or generate 22.79% return on investment over 90 days.

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

UNIQA INSURANCE GR  vs.  Valero Energy

UNIQA INSURANCE GR

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in UNIQA INSURANCE GR are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, UNIQA INSURANCE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Valero Energy

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Valero Energy are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, Valero Energy may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with UNIQA INSURANCE and Valero Energy

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

The idea behind UNIQA INSURANCE GR and Valero Energy 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.