Correlation Between Cboe UK and UBS ETF
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By analyzing existing cross correlation between Cboe UK Consumer and UBS ETF plc, you can compare the effects of market volatilities on Cboe UK and UBS ETF 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 Cboe UK with a short position of UBS ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cboe UK and UBS ETF.
Diversification Opportunities for Cboe UK and UBS ETF
Very weak diversification
The 3 months correlation between Cboe and UBS is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Cboe UK Consumer and UBS ETF plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS ETF plc and Cboe UK 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 Cboe UK Consumer are associated (or correlated) with UBS ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS ETF plc has no effect on the direction of Cboe UK i.e., Cboe UK and UBS ETF go up and down completely randomly.
Pair Corralation between Cboe UK and UBS ETF
Assuming the 90 days trading horizon Cboe UK Consumer is expected to generate 1.4 times more return on investment than UBS ETF. However, Cboe UK is 1.4 times more volatile than UBS ETF plc. It trades about -0.01 of its potential returns per unit of risk. UBS ETF plc is currently generating about -0.15 per unit of risk. If you would invest 3,224,636 in Cboe UK Consumer on November 28, 2024 and sell it today you would lose (15,034) from holding Cboe UK Consumer or give up 0.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Cboe UK Consumer vs. UBS ETF plc
Performance |
| Timeline |
Cboe UK and UBS ETF Volatility Contrast
Predicted Return Density |
| Returns |
Cboe UK Consumer
Pair trading matchups for Cboe UK
UBS ETF plc
Pair trading matchups for UBS ETF
Pair Trading with Cboe UK and UBS ETF
The main advantage of trading using opposite Cboe UK and UBS ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cboe UK position performs unexpectedly, UBS ETF 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 ETF will offset losses from the drop in UBS ETF's long position.| Cboe UK vs. Eastinco Mining Exploration | Cboe UK vs. Pan American Silver | Cboe UK vs. Dolly Varden Silver | Cboe UK vs. Griffin Mining |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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