Correlation Between BKS Bank and UNIQA Insurance

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

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

Diversification Opportunities for BKS Bank and UNIQA Insurance

0.79

Correlation Coefficient

BKS Bank  UNIQA Insurance

Poor diversification

The 3 months correlation between BKS and UNIQA is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding BKS Bank AG 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 BKS Bank 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 BKS Bank AG 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 BKS Bank i.e., BKS Bank and UNIQA Insurance go up and down completely randomly.

Pair Corralation between BKS Bank and UNIQA Insurance

Assuming the 90 days trading horizon BKS Bank is expected to generate 2.92 times less return on investment than UNIQA Insurance. But when comparing it to its historical volatility, BKS Bank AG is 2.46 times less risky than UNIQA Insurance. It trades about 0.18 of its potential returns per unit of risk. UNIQA Insurance Group is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest  1,026  in UNIQA Insurance Group on May 7, 2025 and sell it today you would earn a total of  226.00  from holding UNIQA Insurance Group or generate 22.03% return on investment over 90 days.

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

BKS Bank AG  vs.  UNIQA Insurance Group

BKS Bank AG

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in BKS Bank AG are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, BKS Bank may actually be approaching a critical reversion point that can send shares even higher in September 2025.

UNIQA Insurance Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in UNIQA Insurance Group are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, UNIQA Insurance demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with BKS Bank and UNIQA Insurance

The main advantage of trading using opposite BKS Bank and UNIQA Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BKS Bank 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 BKS Bank AG 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.