Correlation Between IShares STOXX and UBS Fund
Can any of the company-specific risk be diversified away by investing in both IShares STOXX and UBS Fund 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 IShares STOXX and UBS Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares STOXX Europe and UBS Fund Solutions, you can compare the effects of market volatilities on IShares STOXX and UBS Fund 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 IShares STOXX with a short position of UBS Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares STOXX and UBS Fund.
Diversification Opportunities for IShares STOXX and UBS Fund
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between IShares and UBS is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding iShares STOXX Europe and UBS Fund Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS Fund Solutions and IShares 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 iShares STOXX Europe are associated (or correlated) with UBS Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS Fund Solutions has no effect on the direction of IShares STOXX i.e., IShares STOXX and UBS Fund go up and down completely randomly.
Pair Corralation between IShares STOXX and UBS Fund
Assuming the 90 days trading horizon iShares STOXX Europe is expected to generate 0.9 times more return on investment than UBS Fund. However, iShares STOXX Europe is 1.12 times less risky than UBS Fund. It trades about 0.11 of its potential returns per unit of risk. UBS Fund Solutions is currently generating about 0.05 per unit of risk. If you would invest 1,559 in iShares STOXX Europe on September 4, 2024 and sell it today you would earn a total of 440.00 from holding iShares STOXX Europe or generate 28.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
iShares STOXX Europe vs. UBS Fund Solutions
Performance |
| Timeline |
| iShares STOXX Europe |
| UBS Fund Solutions |
IShares STOXX and UBS Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares STOXX and UBS Fund
The main advantage of trading using opposite IShares STOXX and UBS Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares STOXX position performs unexpectedly, UBS Fund 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 Fund will offset losses from the drop in UBS Fund's long position.| IShares STOXX vs. UBS Fund Solutions | IShares STOXX vs. Xtrackers II | IShares STOXX vs. Xtrackers Nikkei 225 | IShares STOXX vs. iShares VII PLC |
| UBS Fund vs. UBS Barclays Liquid | UBS Fund vs. UBS ETF Public | UBS Fund vs. UBS ETF SICAV | UBS Fund 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |