Correlation Between Bath Body and Ubisoft Entertainment
Can any of the company-specific risk be diversified away by investing in both Bath Body and Ubisoft Entertainment 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 Bath Body and Ubisoft Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bath Body Works and Ubisoft Entertainment, you can compare the effects of market volatilities on Bath Body and Ubisoft Entertainment 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 Bath Body with a short position of Ubisoft Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bath Body and Ubisoft Entertainment.
Diversification Opportunities for Bath Body and Ubisoft Entertainment
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bath and Ubisoft is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Bath Body Works and Ubisoft Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ubisoft Entertainment and Bath Body 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 Bath Body Works are associated (or correlated) with Ubisoft Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ubisoft Entertainment has no effect on the direction of Bath Body i.e., Bath Body and Ubisoft Entertainment go up and down completely randomly.
Pair Corralation between Bath Body and Ubisoft Entertainment
Assuming the 90 days trading horizon Bath Body Works is expected to generate 0.52 times more return on investment than Ubisoft Entertainment. However, Bath Body Works is 1.92 times less risky than Ubisoft Entertainment. It trades about -0.22 of its potential returns per unit of risk. Ubisoft Entertainment is currently generating about -0.15 per unit of risk. If you would invest 3,863 in Bath Body Works on October 30, 2024 and sell it today you would lose (238.00) from holding Bath Body Works or give up 6.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Bath Body Works vs. Ubisoft Entertainment
Performance |
| Timeline |
| Bath Body Works |
| Ubisoft Entertainment |
Bath Body and Ubisoft Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bath Body and Ubisoft Entertainment
The main advantage of trading using opposite Bath Body and Ubisoft Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bath Body position performs unexpectedly, Ubisoft Entertainment 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 Ubisoft Entertainment will offset losses from the drop in Ubisoft Entertainment's long position.| Bath Body vs. Ecofin Global Utilities | Bath Body vs. Check Point Software | Bath Body vs. Ebro Foods | Bath Body vs. Travel Leisure Co |
| Ubisoft Entertainment vs. American Homes 4 | Ubisoft Entertainment vs. Universal Music Group | Ubisoft Entertainment vs. Odfjell Drilling | Ubisoft Entertainment vs. Ecclesiastical Insurance Office |
Check out your portfolio center.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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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