Correlation Between United Guardian and Newell Brands
Can any of the company-specific risk be diversified away by investing in both United Guardian and Newell Brands 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 United Guardian and Newell Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Guardian and Newell Brands, you can compare the effects of market volatilities on United Guardian and Newell Brands 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 United Guardian with a short position of Newell Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Guardian and Newell Brands.
Diversification Opportunities for United Guardian and Newell Brands
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between United and Newell is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding United Guardian and Newell Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newell Brands and United Guardian 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 United Guardian are associated (or correlated) with Newell Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newell Brands has no effect on the direction of United Guardian i.e., United Guardian and Newell Brands go up and down completely randomly.
Pair Corralation between United Guardian and Newell Brands
Allowing for the 90-day total investment horizon United Guardian is expected to generate 0.89 times more return on investment than Newell Brands. However, United Guardian is 1.12 times less risky than Newell Brands. It trades about 0.01 of its potential returns per unit of risk. Newell Brands is currently generating about 0.0 per unit of risk. If you would invest 1,073 in United Guardian on August 27, 2024 and sell it today you would lose (98.00) from holding United Guardian or give up 9.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Guardian vs. Newell Brands
Performance |
| Timeline |
| United Guardian |
| Newell Brands |
United Guardian and Newell Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Guardian and Newell Brands
The main advantage of trading using opposite United Guardian and Newell Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Guardian position performs unexpectedly, Newell Brands 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 Newell Brands will offset losses from the drop in Newell Brands' long position.| United Guardian vs. Utah Medical Products | United Guardian vs. Union Bankshares | United Guardian vs. Psychemedics | United Guardian vs. Unity Bancorp |
| Newell Brands vs. The Clorox | Newell Brands vs. Colgate Palmolive | Newell Brands vs. Procter Gamble | Newell Brands vs. Unilever PLC ADR |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |