Correlation Between Uniinfo Telecom and Computer Age

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

By analyzing existing cross correlation between Uniinfo Telecom Services and Computer Age Management, you can compare the effects of market volatilities on Uniinfo Telecom and Computer Age 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 Uniinfo Telecom with a short position of Computer Age. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniinfo Telecom and Computer Age.

Diversification Opportunities for Uniinfo Telecom and Computer Age

0.37

Correlation Coefficient

Uniinfo Telecom  Computer Age

Weak diversification

The 3 months correlation between Uniinfo and Computer is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Uniinfo Telecom Services and Computer Age Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Age Management and Uniinfo Telecom 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 Uniinfo Telecom Services are associated (or correlated) with Computer Age. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Age Management has no effect on the direction of Uniinfo Telecom i.e., Uniinfo Telecom and Computer Age go up and down completely randomly.

Pair Corralation between Uniinfo Telecom and Computer Age

Assuming the 90 days trading horizon Uniinfo Telecom Services is expected to generate 2.57 times more return on investment than Computer Age. However, Uniinfo Telecom is 2.57 times more volatile than Computer Age Management. It trades about 0.04 of its potential returns per unit of risk. Computer Age Management is currently generating about 0.07 per unit of risk. If you would invest  3,422  in Uniinfo Telecom Services on September 28, 2024 and sell it today you would earn a total of  74.00  from holding Uniinfo Telecom Services or generate 2.16% return on investment over 90 days.

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

Uniinfo Telecom Services  vs.  Computer Age Management

Uniinfo Telecom Services

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Uniinfo Telecom Services has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Uniinfo Telecom is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Computer Age Management

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Computer Age Management are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Computer Age unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Uniinfo Telecom and Computer Age

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

The idea behind Uniinfo Telecom Services and Computer Age Management 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.