Correlation Between WisdomTree and UBS Fund
Can any of the company-specific risk be diversified away by investing in both WisdomTree and UBS Fund 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 WisdomTree and UBS Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WisdomTree SP 500 and UBS Fund Solutions, you can compare the effects of market volatilities on WisdomTree and UBS Fund 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 WisdomTree with a short position of UBS Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of WisdomTree and UBS Fund.
Diversification Opportunities for WisdomTree and UBS Fund
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between WisdomTree and UBS is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding WisdomTree SP 500 and UBS Fund Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS Fund Solutions and WisdomTree 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 WisdomTree SP 500 are associated (or correlated) with UBS Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS Fund Solutions has no effect on the direction of WisdomTree i.e., WisdomTree and UBS Fund go up and down completely randomly.
Pair Corralation between WisdomTree and UBS Fund
Assuming the 90 days trading horizon WisdomTree SP 500 is expected to under-perform the UBS Fund. In addition to that, WisdomTree is 1.78 times more volatile than UBS Fund Solutions. It trades about -0.07 of its total potential returns per unit of risk. UBS Fund Solutions is currently generating about -0.08 per unit of volatility. If you would invest 73,370 in UBS Fund Solutions on August 30, 2024 and sell it today you would lose (2,445) from holding UBS Fund Solutions or give up 3.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
WisdomTree SP 500 vs. UBS Fund Solutions
Performance |
| Timeline |
| WisdomTree SP 500 |
| UBS Fund Solutions |
WisdomTree and UBS Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WisdomTree and UBS Fund
The main advantage of trading using opposite WisdomTree and UBS Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WisdomTree position performs unexpectedly, UBS Fund 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 UBS Fund will offset losses from the drop in UBS Fund's long position.| WisdomTree vs. WisdomTree Zinc | WisdomTree vs. WisdomTree Brent Crude | WisdomTree vs. WisdomTree Aluminium 2x | WisdomTree vs. WisdomTree Enhanced Commodity |
| UBS Fund vs. GraniteShares 3x Short | UBS Fund vs. WisdomTree Natural Gas | UBS Fund vs. Leverage Shares 3x | UBS Fund vs. WisdomTree Natural Gas |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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