Correlation Between UBS Group and Julius Baer
Can any of the company-specific risk be diversified away by investing in both UBS Group and Julius Baer 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 Group and Julius Baer into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBS Group AG and Julius Baer Gruppe, you can compare the effects of market volatilities on UBS Group and Julius Baer 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 Group with a short position of Julius Baer. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS Group and Julius Baer.
Diversification Opportunities for UBS Group and Julius Baer
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between UBS and Julius is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding UBS Group AG and Julius Baer Gruppe in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Julius Baer Gruppe and UBS 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 UBS Group AG are associated (or correlated) with Julius Baer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Julius Baer Gruppe has no effect on the direction of UBS Group i.e., UBS Group and Julius Baer go up and down completely randomly.
Pair Corralation between UBS Group and Julius Baer
Assuming the 90 days trading horizon UBS Group AG is expected to generate 1.24 times more return on investment than Julius Baer. However, UBS Group is 1.24 times more volatile than Julius Baer Gruppe. It trades about 0.46 of its potential returns per unit of risk. Julius Baer Gruppe is currently generating about 0.43 per unit of risk. If you would invest 2,846 in UBS Group AG on November 4, 2024 and sell it today you would earn a total of 388.00 from holding UBS Group AG or generate 13.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
UBS Group AG vs. Julius Baer Gruppe
Performance |
| Timeline |
| UBS Group AG |
| Julius Baer Gruppe |
UBS Group and Julius Baer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UBS Group and Julius Baer
The main advantage of trading using opposite UBS Group and Julius Baer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBS Group position performs unexpectedly, Julius Baer 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 Julius Baer will offset losses from the drop in Julius Baer's long position.| UBS Group vs. Zurich Insurance Group | UBS Group vs. Novartis AG | UBS Group vs. Swiss Re AG | UBS Group vs. ABB |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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