Correlation Between Uniper SE and Sligro Food
Can any of the company-specific risk be diversified away by investing in both Uniper SE and Sligro Food 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 Sligro Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uniper SE and Sligro Food Group, you can compare the effects of market volatilities on Uniper SE and Sligro Food 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 Sligro Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uniper SE and Sligro Food.
Diversification Opportunities for Uniper SE and Sligro Food
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Uniper and Sligro is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Uniper SE and Sligro Food Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sligro Food Group 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 Sligro Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sligro Food Group has no effect on the direction of Uniper SE i.e., Uniper SE and Sligro Food go up and down completely randomly.
Pair Corralation between Uniper SE and Sligro Food
Assuming the 90 days trading horizon Uniper SE is expected to under-perform the Sligro Food. In addition to that, Uniper SE is 2.27 times more volatile than Sligro Food Group. It trades about -0.1 of its total potential returns per unit of risk. Sligro Food Group is currently generating about -0.15 per unit of volatility. If you would invest 1,222 in Sligro Food Group on September 24, 2024 and sell it today you would lose (141.00) from holding Sligro Food Group or give up 11.54% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Uniper SE vs. Sligro Food Group
Performance |
Timeline |
Uniper SE |
Sligro Food Group |
Uniper SE and Sligro Food Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Uniper SE and Sligro Food
The main advantage of trading using opposite Uniper SE and Sligro Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uniper SE position performs unexpectedly, Sligro Food 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 Sligro Food will offset losses from the drop in Sligro Food'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 |
Sligro Food vs. Uniper SE | Sligro Food vs. Mulberry Group PLC | Sligro Food vs. London Security Plc | Sligro Food 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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