Correlation Between UBS ETF and UBS MSCI
Can any of the company-specific risk be diversified away by investing in both UBS ETF and UBS MSCI 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 UBS ETF and UBS MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBS ETF plc and UBS MSCI Canada, you can compare the effects of market volatilities on UBS ETF and UBS MSCI 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 UBS ETF with a short position of UBS MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS ETF and UBS MSCI.
Diversification Opportunities for UBS ETF and UBS MSCI
Almost no diversification
The 3 months correlation between UBS and UBS is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding UBS ETF plc and UBS MSCI Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS MSCI Canada and UBS ETF 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 UBS ETF plc are associated (or correlated) with UBS MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS MSCI Canada has no effect on the direction of UBS ETF i.e., UBS ETF and UBS MSCI go up and down completely randomly.
Pair Corralation between UBS ETF and UBS MSCI
Assuming the 90 days trading horizon UBS ETF is expected to generate 2.32 times less return on investment than UBS MSCI. In addition to that, UBS ETF is 1.06 times more volatile than UBS MSCI Canada. It trades about 0.17 of its total potential returns per unit of risk. UBS MSCI Canada is currently generating about 0.42 per unit of volatility. If you would invest 348,650 in UBS MSCI Canada on August 30, 2024 and sell it today you would earn a total of 24,150 from holding UBS MSCI Canada or generate 6.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
UBS ETF plc vs. UBS MSCI Canada
Performance |
| Timeline |
| UBS ETF plc |
| UBS MSCI Canada |
UBS ETF and UBS MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UBS ETF and UBS MSCI
The main advantage of trading using opposite UBS ETF and UBS MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBS ETF position performs unexpectedly, UBS MSCI 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 MSCI will offset losses from the drop in UBS MSCI's long position.| UBS ETF vs. GraniteShares 3x Short | UBS ETF vs. WisdomTree Natural Gas | UBS ETF vs. Leverage Shares 3x | UBS ETF vs. WisdomTree Natural Gas |
| UBS MSCI vs. UBS ETF | UBS MSCI vs. UBS ETF plc | UBS MSCI vs. UBS ETF plc | UBS MSCI vs. UBS Fund Solutions |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |