Correlation Between Uniper SE and Nordic Semiconductor
Can any of the company-specific risk be diversified away by investing in both Uniper SE and Nordic Semiconductor 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 Uniper SE and Nordic Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uniper SE and Nordic Semiconductor ASA, you can compare the effects of market volatilities on Uniper SE and Nordic Semiconductor 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 Uniper SE with a short position of Nordic Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniper SE and Nordic Semiconductor.
Diversification Opportunities for Uniper SE and Nordic Semiconductor
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Uniper and Nordic is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Uniper SE and Nordic Semiconductor ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nordic Semiconductor ASA and Uniper SE 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 Uniper SE are associated (or correlated) with Nordic Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nordic Semiconductor ASA has no effect on the direction of Uniper SE i.e., Uniper SE and Nordic Semiconductor go up and down completely randomly.
Pair Corralation between Uniper SE and Nordic Semiconductor
Assuming the 90 days trading horizon Uniper SE is expected to generate 0.78 times more return on investment than Nordic Semiconductor. However, Uniper SE is 1.29 times less risky than Nordic Semiconductor. It trades about -0.09 of its potential returns per unit of risk. Nordic Semiconductor ASA is currently generating about -0.15 per unit of risk. If you would invest 4,727 in Uniper SE on September 24, 2024 and sell it today you would lose (772.00) from holding Uniper SE or give up 16.33% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Uniper SE vs. Nordic Semiconductor ASA
Performance |
Timeline |
Uniper SE |
Nordic Semiconductor ASA |
Uniper SE and Nordic Semiconductor Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Uniper SE and Nordic Semiconductor
The main advantage of trading using opposite Uniper SE and Nordic Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniper SE position performs unexpectedly, Nordic Semiconductor 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 Nordic Semiconductor will offset losses from the drop in Nordic Semiconductor's long position.Uniper SE vs. Mulberry Group PLC | Uniper SE vs. London Security Plc | Uniper SE vs. Triad Group PLC | Uniper SE vs. SURETRACK MON |
Nordic Semiconductor vs. Uniper SE | Nordic Semiconductor vs. Mulberry Group PLC | Nordic Semiconductor vs. London Security Plc | Nordic Semiconductor vs. Triad Group PLC |
Check out your portfolio center.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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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