Correlation Between UNITED INTERNET and YASKAWA ELEC

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

By analyzing existing cross correlation between UNITED INTERNET N and YASKAWA ELEC UNSP, you can compare the effects of market volatilities on UNITED INTERNET and YASKAWA ELEC 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 UNITED INTERNET with a short position of YASKAWA ELEC. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNITED INTERNET and YASKAWA ELEC.

Diversification Opportunities for UNITED INTERNET and YASKAWA ELEC

0.17

Correlation Coefficient

UNITED INTERNET  YASKAWA ELEC

Average diversification

The 3 months correlation between UNITED and YASKAWA is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding UNITED INTERNET N and YASKAWA ELEC UNSP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YASKAWA ELEC UNSP and UNITED INTERNET 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 UNITED INTERNET N are associated (or correlated) with YASKAWA ELEC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YASKAWA ELEC UNSP has no effect on the direction of UNITED INTERNET i.e., UNITED INTERNET and YASKAWA ELEC go up and down completely randomly.

Pair Corralation between UNITED INTERNET and YASKAWA ELEC

Assuming the 90 days trading horizon UNITED INTERNET N is expected to generate 0.7 times more return on investment than YASKAWA ELEC. However, UNITED INTERNET N is 1.42 times less risky than YASKAWA ELEC. It trades about 0.23 of its potential returns per unit of risk. YASKAWA ELEC UNSP is currently generating about 0.03 per unit of risk. If you would invest  1,749  in UNITED INTERNET N on April 22, 2025 and sell it today you would earn a total of  687.00  from holding UNITED INTERNET N or generate 39.28% return on investment over 90 days.

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

UNITED INTERNET N  vs.  YASKAWA ELEC UNSP

UNITED INTERNET N

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in UNITED INTERNET N are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, UNITED INTERNET unveiled solid returns over the last few months and may actually be approaching a breakup point.

YASKAWA ELEC UNSP

Risk-Adjusted Performance

Weak

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

Pair Trading with UNITED INTERNET and YASKAWA ELEC

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

The idea behind UNITED INTERNET N and YASKAWA ELEC UNSP 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.