Correlation Between Universal Display and Satellogic Warrant
Can any of the company-specific risk be diversified away by investing in both Universal Display and Satellogic Warrant 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 Universal Display and Satellogic Warrant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Universal Display and Satellogic Warrant, you can compare the effects of market volatilities on Universal Display and Satellogic Warrant 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 Universal Display with a short position of Satellogic Warrant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Display and Satellogic Warrant.
Diversification Opportunities for Universal Display and Satellogic Warrant
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Universal and Satellogic is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Universal Display and Satellogic Warrant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Satellogic Warrant and Universal Display 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 Universal Display are associated (or correlated) with Satellogic Warrant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Satellogic Warrant has no effect on the direction of Universal Display i.e., Universal Display and Satellogic Warrant go up and down completely randomly.
Pair Corralation between Universal Display and Satellogic Warrant
Given the investment horizon of 90 days Universal Display is expected to generate 1114.08 times less return on investment than Satellogic Warrant. But when comparing it to its historical volatility, Universal Display is 78.19 times less risky than Satellogic Warrant. It trades about 0.01 of its potential returns per unit of risk. Satellogic Warrant is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 14.00 in Satellogic Warrant on August 26, 2024 and sell it today you would lose (6.50) from holding Satellogic Warrant or give up 46.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 49.4% |
| Values | Daily Returns |
Universal Display vs. Satellogic Warrant
Performance |
| Timeline |
| Universal Display |
| Satellogic Warrant |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Universal Display and Satellogic Warrant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Universal Display and Satellogic Warrant
The main advantage of trading using opposite Universal Display and Satellogic Warrant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Universal Display position performs unexpectedly, Satellogic Warrant 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 Satellogic Warrant will offset losses from the drop in Satellogic Warrant's long position.| Universal Display vs. Plexus Corp | Universal Display vs. Methode Electronics | Universal Display vs. Benchmark Electronics | Universal Display vs. Bel Fuse A |
| Satellogic Warrant vs. Plexus Corp | Satellogic Warrant vs. Benchmark Electronics | Satellogic Warrant vs. Jabil Circuit | Satellogic Warrant vs. Sanmina |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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