Correlation Between Ubs Allocation and Ubs International
Can any of the company-specific risk be diversified away by investing in both Ubs Allocation and Ubs International 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 Ubs Allocation and Ubs International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ubs Allocation Fund and Ubs International Sustainable, you can compare the effects of market volatilities on Ubs Allocation and Ubs International 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 Ubs Allocation with a short position of Ubs International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ubs Allocation and Ubs International.
Diversification Opportunities for Ubs Allocation and Ubs International
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ubs and Ubs is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Ubs Allocation Fund and Ubs International Sustainable in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ubs International and Ubs Allocation 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 Ubs Allocation Fund are associated (or correlated) with Ubs International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ubs International has no effect on the direction of Ubs Allocation i.e., Ubs Allocation and Ubs International go up and down completely randomly.
Pair Corralation between Ubs Allocation and Ubs International
Assuming the 90 days horizon Ubs Allocation Fund is expected to generate 0.8 times more return on investment than Ubs International. However, Ubs Allocation Fund is 1.25 times less risky than Ubs International. It trades about 0.14 of its potential returns per unit of risk. Ubs International Sustainable is currently generating about 0.08 per unit of risk. If you would invest 4,502 in Ubs Allocation Fund on September 4, 2024 and sell it today you would earn a total of 964.00 from holding Ubs Allocation Fund or generate 21.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ubs Allocation Fund vs. Ubs International Sustainable
Performance |
| Timeline |
| Ubs Allocation |
| Ubs International |
Ubs Allocation and Ubs International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ubs Allocation and Ubs International
The main advantage of trading using opposite Ubs Allocation and Ubs International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ubs Allocation position performs unexpectedly, Ubs International 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 International will offset losses from the drop in Ubs International's long position.The idea behind Ubs Allocation Fund and Ubs International Sustainable pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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