Correlation Between Newell and Universal Display
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By analyzing existing cross correlation between Newell Brands 42 and Universal Display, you can compare the effects of market volatilities on Newell and Universal Display 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 Newell with a short position of Universal Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Newell and Universal Display.
Diversification Opportunities for Newell and Universal Display
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Newell and Universal is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Newell Brands 42 and Universal Display in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Display and Newell 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 Newell Brands 42 are associated (or correlated) with Universal Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Display has no effect on the direction of Newell i.e., Newell and Universal Display go up and down completely randomly.
Pair Corralation between Newell and Universal Display
Assuming the 90 days trading horizon Newell Brands 42 is expected to generate 0.2 times more return on investment than Universal Display. However, Newell Brands 42 is 5.02 times less risky than Universal Display. It trades about -0.05 of its potential returns per unit of risk. Universal Display is currently generating about -0.01 per unit of risk. If you would invest 9,920 in Newell Brands 42 on September 5, 2024 and sell it today you would lose (410.00) from holding Newell Brands 42 or give up 4.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.6% |
| Values | Daily Returns |
Newell Brands 42 vs. Universal Display
Performance |
| Timeline |
| Newell Brands 42 |
| Universal Display |
Newell and Universal Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Newell and Universal Display
The main advantage of trading using opposite Newell and Universal Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Newell position performs unexpectedly, Universal Display 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 Universal Display will offset losses from the drop in Universal Display's long position.| Newell vs. Universal Display | Newell vs. Cadence Design Systems | Newell vs. Hasbro Inc | Newell vs. Rackspace Technology |
| Universal Display vs. Plexus Corp | Universal Display vs. Methode Electronics | Universal Display vs. Benchmark Electronics | Universal Display vs. Bel Fuse A |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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