Correlation Between UBS Group and Credit Acceptance
Can any of the company-specific risk be diversified away by investing in both UBS Group and Credit Acceptance 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 Credit Acceptance 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 Credit Acceptance, you can compare the effects of market volatilities on UBS Group and Credit Acceptance 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 Credit Acceptance. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS Group and Credit Acceptance.
Diversification Opportunities for UBS Group and Credit Acceptance
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between UBS and Credit is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding UBS Group AG and Credit Acceptance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Acceptance 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 Credit Acceptance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Acceptance has no effect on the direction of UBS Group i.e., UBS Group and Credit Acceptance go up and down completely randomly.
Pair Corralation between UBS Group and Credit Acceptance
If you would invest 18,715 in UBS Group AG on September 12, 2024 and sell it today you would earn a total of 1,225 from holding UBS Group AG or generate 6.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
UBS Group AG vs. Credit Acceptance
Performance |
| Timeline |
| UBS Group AG |
| Credit Acceptance |
UBS Group and Credit Acceptance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UBS Group and Credit Acceptance
The main advantage of trading using opposite UBS Group and Credit Acceptance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBS Group position performs unexpectedly, Credit Acceptance 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 Credit Acceptance will offset losses from the drop in Credit Acceptance's long position.| UBS Group vs. Electronic Arts | UBS Group vs. Metalurgica Gerdau SA | UBS Group vs. Zoom Video Communications | UBS Group vs. United Rentals |
| Credit Acceptance vs. Paycom Software | Credit Acceptance vs. Zoom Video Communications | Credit Acceptance vs. Apartment Investment and | Credit Acceptance vs. Charter Communications |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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