Correlation Between U Blox and Southwest Gas
Can any of the company-specific risk be diversified away by investing in both U Blox and Southwest Gas 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 U Blox and Southwest Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between u blox Holding AG and Southwest Gas Holdings, you can compare the effects of market volatilities on U Blox and Southwest Gas 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 U Blox with a short position of Southwest Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of U Blox and Southwest Gas.
Diversification Opportunities for U Blox and Southwest Gas
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between UBLXF and Southwest is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding u blox Holding AG and Southwest Gas Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southwest Gas Holdings and U Blox 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 u blox Holding AG are associated (or correlated) with Southwest Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southwest Gas Holdings has no effect on the direction of U Blox i.e., U Blox and Southwest Gas go up and down completely randomly.
Pair Corralation between U Blox and Southwest Gas
Assuming the 90 days horizon u blox Holding AG is expected to under-perform the Southwest Gas. In addition to that, U Blox is 1.5 times more volatile than Southwest Gas Holdings. It trades about -0.09 of its total potential returns per unit of risk. Southwest Gas Holdings is currently generating about 0.21 per unit of volatility. If you would invest 7,299 in Southwest Gas Holdings on August 31, 2024 and sell it today you would earn a total of 531.00 from holding Southwest Gas Holdings or generate 7.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
u blox Holding AG vs. Southwest Gas Holdings
Performance |
| Timeline |
| u blox Holding |
| Southwest Gas Holdings |
U Blox and Southwest Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with U Blox and Southwest Gas
The main advantage of trading using opposite U Blox and Southwest Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if U Blox position performs unexpectedly, Southwest Gas 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 Southwest Gas will offset losses from the drop in Southwest Gas' long position.| U Blox vs. Southwest Gas Holdings | U Blox vs. Waste Management | U Blox vs. Royalty Management Holding | U Blox vs. Aris Water Solutions |
| Southwest Gas vs. NewJersey Resources | Southwest Gas vs. Northwest Natural Gas | Southwest Gas vs. NorthWestern | Southwest Gas vs. Chesapeake Utilities |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |