Correlation Between Unipar Carbocloro and Nucor

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

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

Diversification Opportunities for Unipar Carbocloro and Nucor

-0.09

Correlation Coefficient

Unipar Carbocloro  Nucor

Good diversification

The 3 months correlation between Unipar and Nucor is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Unipar Carbocloro SA and Nucor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nucor and Unipar Carbocloro 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 Unipar Carbocloro SA are associated (or correlated) with Nucor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nucor has no effect on the direction of Unipar Carbocloro i.e., Unipar Carbocloro and Nucor go up and down completely randomly.

Pair Corralation between Unipar Carbocloro and Nucor

Assuming the 90 days trading horizon Unipar Carbocloro SA is expected to under-perform the Nucor. But the stock apears to be less risky and, when comparing its historical volatility, Unipar Carbocloro SA is 1.5 times less risky than Nucor. The stock trades about 0.0 of its potential returns per unit of risk. The Nucor is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  5,211  in Nucor on April 23, 2025 and sell it today you would earn a total of  1,495  from holding Nucor or generate 28.69% return on investment over 90 days.

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

Unipar Carbocloro SA  vs.  Nucor

Unipar Carbocloro

Risk-Adjusted Performance

Very Weak

Over the last 90 days Unipar Carbocloro SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Unipar Carbocloro is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Nucor

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Nucor are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Nucor sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Unipar Carbocloro and Nucor

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

The idea behind Unipar Carbocloro SA and Nucor 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.