Correlation Between Cube Entertainment and UIL
Can any of the company-specific risk be diversified away by investing in both Cube Entertainment and UIL 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 Cube Entertainment and UIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cube Entertainment and UIL Co, you can compare the effects of market volatilities on Cube Entertainment and UIL 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 Cube Entertainment with a short position of UIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cube Entertainment and UIL.
Diversification Opportunities for Cube Entertainment and UIL
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cube and UIL is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Cube Entertainment and UIL Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UIL Co and Cube Entertainment 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 Cube Entertainment are associated (or correlated) with UIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UIL Co has no effect on the direction of Cube Entertainment i.e., Cube Entertainment and UIL go up and down completely randomly.
Pair Corralation between Cube Entertainment and UIL
Assuming the 90 days trading horizon Cube Entertainment is expected to generate 2.2 times less return on investment than UIL. In addition to that, Cube Entertainment is 1.01 times more volatile than UIL Co. It trades about 0.02 of its total potential returns per unit of risk. UIL Co is currently generating about 0.04 per unit of volatility. If you would invest 362,000 in UIL Co on September 14, 2024 and sell it today you would earn a total of 148,000 from holding UIL Co or generate 40.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Cube Entertainment vs. UIL Co
Performance |
| Timeline |
| Cube Entertainment |
| UIL Co |
Cube Entertainment and UIL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cube Entertainment and UIL
The main advantage of trading using opposite Cube Entertainment and UIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cube Entertainment position performs unexpectedly, UIL 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 UIL will offset losses from the drop in UIL's long position.| Cube Entertainment vs. PlayD Co | Cube Entertainment vs. Neungyule Education | Cube Entertainment vs. Solution Advanced Technology | Cube Entertainment vs. Busan Industrial Co |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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