Correlation Between UBS ETF and Baloise Holding
Can any of the company-specific risk be diversified away by investing in both UBS ETF and Baloise Holding 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 ETF and Baloise Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBS ETF SMIM and Baloise Holding AG, you can compare the effects of market volatilities on UBS ETF and Baloise Holding 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 ETF with a short position of Baloise Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS ETF and Baloise Holding.
Diversification Opportunities for UBS ETF and Baloise Holding
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between UBS and Baloise is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding UBS ETF SMIM and Baloise Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baloise Holding AG and UBS ETF 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 ETF SMIM are associated (or correlated) with Baloise Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baloise Holding AG has no effect on the direction of UBS ETF i.e., UBS ETF and Baloise Holding go up and down completely randomly.
Pair Corralation between UBS ETF and Baloise Holding
Assuming the 90 days trading horizon UBS ETF SMIM is expected to generate 0.88 times more return on investment than Baloise Holding. However, UBS ETF SMIM is 1.13 times less risky than Baloise Holding. It trades about 0.12 of its potential returns per unit of risk. Baloise Holding AG is currently generating about -0.1 per unit of risk. If you would invest 26,140 in UBS ETF SMIM on September 13, 2024 and sell it today you would earn a total of 405.00 from holding UBS ETF SMIM or generate 1.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
UBS ETF SMIM vs. Baloise Holding AG
Performance |
| Timeline |
| UBS ETF SMIM |
| Baloise Holding AG |
UBS ETF and Baloise Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UBS ETF and Baloise Holding
The main advantage of trading using opposite UBS ETF and Baloise Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBS ETF position performs unexpectedly, Baloise Holding 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 Baloise Holding will offset losses from the drop in Baloise Holding's long position.| UBS ETF vs. Baloise Holding AG | UBS ETF vs. 21Shares Polkadot ETP | UBS ETF vs. UBS ETF MSCI | UBS ETF vs. BB Biotech AG |
| Baloise Holding vs. Swiss Life Holding | Baloise Holding vs. Helvetia Holding AG | Baloise Holding vs. Swisscom AG | Baloise Holding vs. Zurich Insurance Group |
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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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