Correlation Between FlexShares STOXX and UBS
Can any of the company-specific risk be diversified away by investing in both FlexShares STOXX and UBS 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 FlexShares STOXX and UBS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FlexShares STOXX ESG and UBS, you can compare the effects of market volatilities on FlexShares STOXX and UBS 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 FlexShares STOXX with a short position of UBS. Check out your portfolio center. Please also check ongoing floating volatility patterns of FlexShares STOXX and UBS.
Diversification Opportunities for FlexShares STOXX and UBS
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between FlexShares and UBS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding FlexShares STOXX ESG and UBS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS and FlexShares STOXX 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 FlexShares STOXX ESG are associated (or correlated) with UBS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS has no effect on the direction of FlexShares STOXX i.e., FlexShares STOXX and UBS go up and down completely randomly.
Pair Corralation between FlexShares STOXX and UBS
Considering the 90-day investment horizon FlexShares STOXX ESG is expected to generate 0.63 times more return on investment than UBS. However, FlexShares STOXX ESG is 1.58 times less risky than UBS. It trades about 0.11 of its potential returns per unit of risk. UBS is currently generating about 0.02 per unit of risk. If you would invest 9,753 in FlexShares STOXX ESG on November 2, 2024 and sell it today you would earn a total of 4,589 from holding FlexShares STOXX ESG or generate 47.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 22.52% |
| Values | Daily Returns |
FlexShares STOXX ESG vs. UBS
Performance |
| Timeline |
| FlexShares STOXX ESG |
| UBS |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
FlexShares STOXX and UBS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FlexShares STOXX and UBS
The main advantage of trading using opposite FlexShares STOXX and UBS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FlexShares STOXX position performs unexpectedly, UBS 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 will offset losses from the drop in UBS's long position.| FlexShares STOXX vs. iShares ESG Aware | FlexShares STOXX vs. FlexShares STOXX Global | FlexShares STOXX vs. iShares ESG Aware | FlexShares STOXX vs. iShares ESG Aware |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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