Correlation Between Acco Brands and Universal Display
Can any of the company-specific risk be diversified away by investing in both Acco Brands and Universal Display 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 Acco Brands and Universal Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acco Brands and Universal Display, you can compare the effects of market volatilities on Acco Brands and Universal Display 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 Acco Brands with a short position of Universal Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acco Brands and Universal Display.
Diversification Opportunities for Acco Brands and Universal Display
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Acco and Universal is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Acco Brands and Universal Display in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Display and Acco Brands 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 Acco Brands are associated (or correlated) with Universal Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Display has no effect on the direction of Acco Brands i.e., Acco Brands and Universal Display go up and down completely randomly.
Pair Corralation between Acco Brands and Universal Display
Given the investment horizon of 90 days Acco Brands is expected to generate 1.82 times less return on investment than Universal Display. But when comparing it to its historical volatility, Acco Brands is 1.04 times less risky than Universal Display. It trades about 0.02 of its potential returns per unit of risk. Universal Display is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 11,336 in Universal Display on August 30, 2024 and sell it today you would earn a total of 4,781 from holding Universal Display or generate 42.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Acco Brands vs. Universal Display
Performance |
| Timeline |
| Acco Brands |
| Universal Display |
Acco Brands and Universal Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acco Brands and Universal Display
The main advantage of trading using opposite Acco Brands and Universal Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acco Brands position performs unexpectedly, Universal Display 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 Universal Display will offset losses from the drop in Universal Display's long position.| Acco Brands vs. HNI Corp | Acco Brands vs. Steelcase | Acco Brands vs. Ennis Inc | Acco Brands vs. Acacia Research |
| Universal Display vs. Plexus Corp | Universal Display vs. Methode Electronics | Universal Display vs. Benchmark Electronics | Universal Display vs. Bel Fuse A |
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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