Correlation Between UBSFund Solutions and ZKB Gold
Can any of the company-specific risk be diversified away by investing in both UBSFund Solutions and ZKB Gold 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 UBSFund Solutions and ZKB Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBSFund Solutions MSCI and ZKB Gold ETF, you can compare the effects of market volatilities on UBSFund Solutions and ZKB Gold 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 UBSFund Solutions with a short position of ZKB Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBSFund Solutions and ZKB Gold.
Diversification Opportunities for UBSFund Solutions and ZKB Gold
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between UBSFund and ZKB is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding UBSFund Solutions MSCI and ZKB Gold ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZKB Gold ETF and UBSFund Solutions 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 UBSFund Solutions MSCI are associated (or correlated) with ZKB Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZKB Gold ETF has no effect on the direction of UBSFund Solutions i.e., UBSFund Solutions and ZKB Gold go up and down completely randomly.
Pair Corralation between UBSFund Solutions and ZKB Gold
Assuming the 90 days trading horizon UBSFund Solutions is expected to generate 16.3 times less return on investment than ZKB Gold. In addition to that, UBSFund Solutions is 1.22 times more volatile than ZKB Gold ETF. It trades about 0.01 of its total potential returns per unit of risk. ZKB Gold ETF is currently generating about 0.12 per unit of volatility. If you would invest 232,800 in ZKB Gold ETF on September 3, 2024 and sell it today you would earn a total of 16,450 from holding ZKB Gold ETF or generate 7.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 96.92% |
| Values | Daily Returns |
UBSFund Solutions MSCI vs. ZKB Gold ETF
Performance |
| Timeline |
| UBSFund Solutions MSCI |
| ZKB Gold ETF |
UBSFund Solutions and ZKB Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UBSFund Solutions and ZKB Gold
The main advantage of trading using opposite UBSFund Solutions and ZKB Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBSFund Solutions position performs unexpectedly, ZKB Gold 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 ZKB Gold will offset losses from the drop in ZKB Gold's long position.| UBSFund Solutions vs. Vanguard SP 500 | UBSFund Solutions vs. iShares VII PLC | UBSFund Solutions vs. iShares Core SP | UBSFund Solutions vs. Lyxor Japan UCITS |
| ZKB Gold vs. UBSFund Solutions MSCI | ZKB Gold vs. Vanguard SP 500 | ZKB Gold vs. iShares VII PLC | ZKB Gold vs. iShares Core SP |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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