Correlation Between SPDR SP and UBSFund Solutions
Can any of the company-specific risk be diversified away by investing in both SPDR SP and UBSFund Solutions 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 SPDR SP and UBSFund Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPDR SP Technology and UBSFund Solutions Bloomberg, you can compare the effects of market volatilities on SPDR SP and UBSFund Solutions 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 SPDR SP with a short position of UBSFund Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPDR SP and UBSFund Solutions.
Diversification Opportunities for SPDR SP and UBSFund Solutions
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SPDR and UBSFund is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding SPDR SP Technology and UBSFund Solutions Bloomberg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBSFund Solutions and SPDR SP 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 SPDR SP Technology are associated (or correlated) with UBSFund Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBSFund Solutions has no effect on the direction of SPDR SP i.e., SPDR SP and UBSFund Solutions go up and down completely randomly.
Pair Corralation between SPDR SP and UBSFund Solutions
Assuming the 90 days trading horizon SPDR SP Technology is expected to generate 1.47 times more return on investment than UBSFund Solutions. However, SPDR SP is 1.47 times more volatile than UBSFund Solutions Bloomberg. It trades about 0.06 of its potential returns per unit of risk. UBSFund Solutions Bloomberg is currently generating about 0.01 per unit of risk. If you would invest 10,918 in SPDR SP Technology on September 2, 2024 and sell it today you would earn a total of 1,180 from holding SPDR SP Technology or generate 10.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.22% |
| Values | Daily Returns |
SPDR SP Technology vs. UBSFund Solutions Bloomberg
Performance |
| Timeline |
| SPDR SP Technology |
| UBSFund Solutions |
SPDR SP and UBSFund Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPDR SP and UBSFund Solutions
The main advantage of trading using opposite SPDR SP and UBSFund Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPDR SP position performs unexpectedly, UBSFund Solutions 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 UBSFund Solutions will offset losses from the drop in UBSFund Solutions' long position.The idea behind SPDR SP Technology and UBSFund Solutions Bloomberg 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.| UBSFund Solutions vs. UBSFund Solutions MSCI | UBSFund Solutions vs. UBSFund Solutions MSCI | UBSFund Solutions vs. UBSFund Solutions Bloomberg | UBSFund Solutions vs. UBSFund Solutions MSCI |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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