Correlation Between UNIQA Insurance and Exor NV

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

Diversification Opportunities for UNIQA Insurance and Exor NV

0.6

Correlation Coefficient

UNIQA Insurance  Exor NV

Poor diversification

The 3 months correlation between UNIQA and Exor is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding UNIQA Insurance Group and Exor NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exor NV 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 Exor NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exor NV has no effect on the direction of UNIQA Insurance i.e., UNIQA Insurance and Exor NV go up and down completely randomly.

Pair Corralation between UNIQA Insurance and Exor NV

Assuming the 90 days trading horizon UNIQA Insurance Group is expected to generate 0.57 times more return on investment than Exor NV. However, UNIQA Insurance Group is 1.76 times less risky than Exor NV. It trades about -0.02 of its potential returns per unit of risk. Exor NV is currently generating about -0.03 per unit of risk. If you would invest  749.00  in UNIQA Insurance Group on September 16, 2024 and sell it today you would lose (8.00) from holding UNIQA Insurance Group or give up 1.07% of portfolio value over 90 days.

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

UNIQA Insurance Group  vs.  Exor NV

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 fairly strong basic indicators, UNIQA Insurance is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Exor NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Exor NV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, Exor NV is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with UNIQA Insurance and Exor NV

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

The idea behind UNIQA Insurance Group and Exor NV 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.