Correlation Between Credit Suisse and UBS Group
Can any of the company-specific risk be diversified away by investing in both Credit Suisse and UBS Group 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 Credit Suisse and UBS Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Credit Suisse Group and UBS Group AG, you can compare the effects of market volatilities on Credit Suisse and UBS Group 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 Credit Suisse with a short position of UBS Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Credit Suisse and UBS Group.
Diversification Opportunities for Credit Suisse and UBS Group
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Credit and UBS is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Credit Suisse Group and UBS Group AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS Group AG and Credit Suisse 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 Credit Suisse Group are associated (or correlated) with UBS Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS Group AG has no effect on the direction of Credit Suisse i.e., Credit Suisse and UBS Group go up and down completely randomly.
Pair Corralation between Credit Suisse and UBS Group
Allowing for the 90-day total investment horizon Credit Suisse Group is expected to under-perform the UBS Group. In addition to that, Credit Suisse is 3.17 times more volatile than UBS Group AG. It trades about -0.14 of its total potential returns per unit of risk. UBS Group AG is currently generating about 0.08 per unit of volatility. If you would invest 1,730 in UBS Group AG on August 23, 2024 and sell it today you would earn a total of 1,453 from holding UBS Group AG or generate 83.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 26.81% |
| Values | Daily Returns |
Credit Suisse Group vs. UBS Group AG
Performance |
| Timeline |
| Credit Suisse Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| UBS Group AG |
Credit Suisse and UBS Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Credit Suisse and UBS Group
The main advantage of trading using opposite Credit Suisse and UBS Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Suisse position performs unexpectedly, UBS Group 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 Group will offset losses from the drop in UBS Group's long position.| Credit Suisse vs. Barclays PLC ADR | Credit Suisse vs. HSBC Holdings PLC | Credit Suisse vs. ING Group NV | Credit Suisse vs. Citigroup |
| UBS Group vs. Citigroup | UBS Group vs. Barclays PLC ADR | UBS Group vs. HSBC Holdings PLC | UBS Group vs. Nu Holdings |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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