Correlation Between UNIQA INSURANCE and DISTRICT METALS

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

By analyzing existing cross correlation between UNIQA INSURANCE GR and DISTRICT METALS, you can compare the effects of market volatilities on UNIQA INSURANCE and DISTRICT METALS 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 DISTRICT METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIQA INSURANCE and DISTRICT METALS.

Diversification Opportunities for UNIQA INSURANCE and DISTRICT METALS

0.18

Correlation Coefficient

UNIQA INSURANCE  DISTRICT METALS

Average diversification

The 3 months correlation between UNIQA and DISTRICT is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA INSURANCE GR and DISTRICT METALS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DISTRICT METALS 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 GR are associated (or correlated) with DISTRICT METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DISTRICT METALS has no effect on the direction of UNIQA INSURANCE i.e., UNIQA INSURANCE and DISTRICT METALS go up and down completely randomly.

Pair Corralation between UNIQA INSURANCE and DISTRICT METALS

Assuming the 90 days trading horizon UNIQA INSURANCE is expected to generate 17.88 times less return on investment than DISTRICT METALS. But when comparing it to its historical volatility, UNIQA INSURANCE GR is 10.85 times less risky than DISTRICT METALS. It trades about 0.05 of its potential returns per unit of risk. DISTRICT METALS is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  5.34  in DISTRICT METALS on September 29, 2024 and sell it today you would earn a total of  21.66  from holding DISTRICT METALS or generate 405.62% return on investment over 90 days.

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

UNIQA INSURANCE GR  vs.  DISTRICT METALS

UNIQA INSURANCE GR

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in UNIQA INSURANCE GR 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 newest stock price uproar, may contribute to short-horizon losses for the private investors.

DISTRICT METALS

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in DISTRICT METALS are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, DISTRICT METALS may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with UNIQA INSURANCE and DISTRICT METALS

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

The idea behind UNIQA INSURANCE GR and DISTRICT METALS 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.