Correlation Between UNIQA Insurance and Semperit Aktiengesellscha

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

By analyzing existing cross correlation between UNIQA Insurance Group and Semperit Aktiengesellschaft Holding, you can compare the effects of market volatilities on UNIQA Insurance and Semperit Aktiengesellscha 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 Semperit Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQA Insurance and Semperit Aktiengesellscha.

Diversification Opportunities for UNIQA Insurance and Semperit Aktiengesellscha

0.73

Correlation Coefficient

UNIQA Insurance  Semperit Aktiengesellscha

Poor diversification

The 3 months correlation between UNIQA and Semperit is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA Insurance Group and Semperit Aktiengesellschaft Ho in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Semperit Aktiengesellscha 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 Group are associated (or correlated) with Semperit Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Semperit Aktiengesellscha has no effect on the direction of UNIQA Insurance i.e., UNIQA Insurance and Semperit Aktiengesellscha go up and down completely randomly.

Pair Corralation between UNIQA Insurance and Semperit Aktiengesellscha

Assuming the 90 days trading horizon UNIQA Insurance Group is expected to generate 0.63 times more return on investment than Semperit Aktiengesellscha. However, UNIQA Insurance Group is 1.58 times less risky than Semperit Aktiengesellscha. It trades about 0.43 of its potential returns per unit of risk. Semperit Aktiengesellschaft Holding is currently generating about 0.22 per unit of risk. If you would invest  770.00  in UNIQA Insurance Group on December 27, 2024 and sell it today you would earn a total of  236.00  from holding UNIQA Insurance Group or generate 30.65% return on investment over 90 days.

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

UNIQA Insurance Group  vs.  Semperit Aktiengesellschaft Ho

UNIQA Insurance Group

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in UNIQA Insurance Group are ranked lower than 33 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, UNIQA Insurance demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Semperit Aktiengesellscha

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Semperit Aktiengesellschaft Holding are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent primary indicators, Semperit Aktiengesellscha demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with UNIQA Insurance and Semperit Aktiengesellscha

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

The idea behind UNIQA Insurance Group and Semperit Aktiengesellschaft Holding 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.