Correlation Between UNIQA Insurance and Wiener Privatbank

Can any of the company-specific risk be diversified away by investing in both UNIQA Insurance and Wiener Privatbank 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 Wiener Privatbank 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 Wiener Privatbank SE, you can compare the effects of market volatilities on UNIQA Insurance and Wiener Privatbank 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 Wiener Privatbank. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQA Insurance and Wiener Privatbank.

Diversification Opportunities for UNIQA Insurance and Wiener Privatbank

-0.35

Correlation Coefficient

UNIQA Insurance  Wiener Privatbank

Very good diversification

The 3 months correlation between UNIQA and Wiener is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA Insurance Group and Wiener Privatbank SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wiener Privatbank 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 Wiener Privatbank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wiener Privatbank has no effect on the direction of UNIQA Insurance i.e., UNIQA Insurance and Wiener Privatbank go up and down completely randomly.

Pair Corralation between UNIQA Insurance and Wiener Privatbank

Assuming the 90 days trading horizon UNIQA Insurance Group is expected to under-perform the Wiener Privatbank. In addition to that, UNIQA Insurance is 1.08 times more volatile than Wiener Privatbank SE. It trades about -0.14 of its total potential returns per unit of risk. Wiener Privatbank SE is currently generating about 0.15 per unit of volatility. If you would invest  715.00  in Wiener Privatbank SE on September 2, 2024 and sell it today you would earn a total of  50.00  from holding Wiener Privatbank SE or generate 6.99% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.48%
Values	Daily Returns

UNIQA Insurance Group  vs.  Wiener Privatbank SE

UNIQA Insurance Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days UNIQA Insurance Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's basic indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Wiener Privatbank

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Wiener Privatbank SE are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent fundamental drivers, Wiener Privatbank may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with UNIQA Insurance and Wiener Privatbank

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

The idea behind UNIQA Insurance Group and Wiener Privatbank SE 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 Global Correlations module to find global opportunities by holding instruments from different markets.