Correlation Between GAMING FAC and UNIQA Insurance

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

By analyzing existing cross correlation between GAMING FAC SA and UNIQA Insurance Group, you can compare the effects of market volatilities on GAMING FAC and UNIQA Insurance 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 GAMING FAC with a short position of UNIQA Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of GAMING FAC and UNIQA Insurance.

Diversification Opportunities for GAMING FAC and UNIQA Insurance

-0.1

Correlation Coefficient

GAMING FAC  UNIQA Insurance

Good diversification

The 3 months correlation between GAMING and UNIQA is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding GAMING FAC SA and UNIQA Insurance Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNIQA Insurance Group and GAMING FAC 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 GAMING FAC SA are associated (or correlated) with UNIQA Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNIQA Insurance Group has no effect on the direction of GAMING FAC i.e., GAMING FAC and UNIQA Insurance go up and down completely randomly.

Pair Corralation between GAMING FAC and UNIQA Insurance

Assuming the 90 days horizon GAMING FAC SA is expected to under-perform the UNIQA Insurance. In addition to that, GAMING FAC is 1.67 times more volatile than UNIQA Insurance Group. It trades about -0.22 of its total potential returns per unit of risk. UNIQA Insurance Group is currently generating about 0.23 per unit of volatility. If you would invest  735.00  in UNIQA Insurance Group on September 26, 2024 and sell it today you would earn a total of  42.00  from holding UNIQA Insurance Group or generate 5.71% return on investment over 90 days.

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

GAMING FAC SA  vs.  UNIQA Insurance Group

GAMING FAC SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GAMING FAC SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

UNIQA Insurance Group

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in UNIQA Insurance Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, UNIQA Insurance is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with GAMING FAC and UNIQA Insurance

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

The idea behind GAMING FAC SA and UNIQA Insurance Group 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 Stocks Directory module to find actively traded stocks across global markets.