Correlation Between UBS Fund and Ishares II
Can any of the company-specific risk be diversified away by investing in both UBS Fund and Ishares II 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 Fund and Ishares II into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBS Fund Solutions and Ishares II PLC, you can compare the effects of market volatilities on UBS Fund and Ishares II 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 Fund with a short position of Ishares II. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS Fund and Ishares II.
Diversification Opportunities for UBS Fund and Ishares II
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between UBS and Ishares is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding UBS Fund Solutions and Ishares II PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ishares II PLC and UBS Fund 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 Fund Solutions are associated (or correlated) with Ishares II. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ishares II PLC has no effect on the direction of UBS Fund i.e., UBS Fund and Ishares II go up and down completely randomly.
Pair Corralation between UBS Fund and Ishares II
Assuming the 90 days trading horizon UBS Fund Solutions is expected to generate 3.53 times more return on investment than Ishares II. However, UBS Fund is 3.53 times more volatile than Ishares II PLC. It trades about 0.09 of its potential returns per unit of risk. Ishares II PLC is currently generating about 0.03 per unit of risk. If you would invest 5,027 in UBS Fund Solutions on September 12, 2024 and sell it today you would earn a total of 276.00 from holding UBS Fund Solutions or generate 5.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.31% |
| Values | Daily Returns |
UBS Fund Solutions vs. Ishares II PLC
Performance |
| Timeline |
| UBS Fund Solutions |
| Ishares II PLC |
UBS Fund and Ishares II Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UBS Fund and Ishares II
The main advantage of trading using opposite UBS Fund and Ishares II positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBS Fund position performs unexpectedly, Ishares II 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 Ishares II will offset losses from the drop in Ishares II's long position.| UBS Fund vs. UBS Barclays Liquid | UBS Fund vs. UBS ETF Public | UBS Fund vs. UBS ETF SICAV | UBS Fund vs. UBS Fund Solutions |
| Ishares II vs. UBS Fund Solutions | Ishares II vs. Xtrackers II | Ishares II vs. Xtrackers Nikkei 225 | Ishares II vs. iShares VII PLC |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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