Correlation Between Micron Technology and UBS Money
Can any of the company-specific risk be diversified away by investing in both Micron Technology and UBS Money 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 Micron Technology and UBS Money into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Micron Technology and UBS Money Market, you can compare the effects of market volatilities on Micron Technology and UBS Money 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 Micron Technology with a short position of UBS Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Micron Technology and UBS Money.
Diversification Opportunities for Micron Technology and UBS Money
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Micron and UBS is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Micron Technology and UBS Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS Money Market and Micron Technology 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 Micron Technology are associated (or correlated) with UBS Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS Money Market has no effect on the direction of Micron Technology i.e., Micron Technology and UBS Money go up and down completely randomly.
Pair Corralation between Micron Technology and UBS Money
Allowing for the 90-day total investment horizon Micron Technology is expected to under-perform the UBS Money. In addition to that, Micron Technology is 5.9 times more volatile than UBS Money Market. It trades about -0.12 of its total potential returns per unit of risk. UBS Money Market is currently generating about 0.26 per unit of volatility. If you would invest 187,865 in UBS Money Market on September 12, 2024 and sell it today you would earn a total of 4,346 from holding UBS Money Market or generate 2.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Micron Technology vs. UBS Money Market
Performance |
| Timeline |
| Micron Technology |
| UBS Money Market |
Micron Technology and UBS Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Micron Technology and UBS Money
The main advantage of trading using opposite Micron Technology and UBS Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Micron Technology position performs unexpectedly, UBS Money 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 Money will offset losses from the drop in UBS Money's long position.| Micron Technology vs. NVIDIA | Micron Technology vs. Intel | Micron Technology vs. Taiwan Semiconductor Manufacturing | Micron Technology vs. Marvell Technology Group |
| UBS Money vs. Groupama Entreprises N | UBS Money vs. Renaissance Europe C | UBS Money vs. Superior Plus Corp | UBS Money vs. Origin Agritech |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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