Correlation Between SSP Group and Universal Display
Can any of the company-specific risk be diversified away by investing in both SSP Group and Universal Display 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 SSP Group and Universal Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SSP Group PLC and Universal Display Corp, you can compare the effects of market volatilities on SSP Group and Universal Display 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 SSP Group with a short position of Universal Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of SSP Group and Universal Display.
Diversification Opportunities for SSP Group and Universal Display
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SSP and Universal is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding SSP Group PLC and Universal Display Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Display Corp and SSP Group 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 SSP Group PLC are associated (or correlated) with Universal Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Display Corp has no effect on the direction of SSP Group i.e., SSP Group and Universal Display go up and down completely randomly.
Pair Corralation between SSP Group and Universal Display
Assuming the 90 days trading horizon SSP Group PLC is expected to generate 1.43 times more return on investment than Universal Display. However, SSP Group is 1.43 times more volatile than Universal Display Corp. It trades about 0.37 of its potential returns per unit of risk. Universal Display Corp is currently generating about -0.11 per unit of risk. If you would invest 15,670 in SSP Group PLC on September 14, 2024 and sell it today you would earn a total of 3,200 from holding SSP Group PLC or generate 20.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
SSP Group PLC vs. Universal Display Corp
Performance |
| Timeline |
| SSP Group PLC |
| Universal Display Corp |
SSP Group and Universal Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SSP Group and Universal Display
The main advantage of trading using opposite SSP Group and Universal Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SSP Group position performs unexpectedly, Universal Display 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 Universal Display will offset losses from the drop in Universal Display's long position.| SSP Group vs. Universal Display Corp | SSP Group vs. DXC Technology Co | SSP Group vs. Microchip Technology | SSP Group vs. Sabien Technology Group |
| Universal Display vs. European Metals Holdings | Universal Display vs. United Utilities Group | Universal Display vs. Silvercorp Metals | Universal Display vs. Odfjell Drilling |
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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