Correlation Between Universal Display and Scientific Games
Can any of the company-specific risk be diversified away by investing in both Universal Display and Scientific Games 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 Universal Display and Scientific Games into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Universal Display and Scientific Games, you can compare the effects of market volatilities on Universal Display and Scientific Games 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 Universal Display with a short position of Scientific Games. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Display and Scientific Games.
Diversification Opportunities for Universal Display and Scientific Games
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Universal and Scientific is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Universal Display and Scientific Games in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scientific Games and Universal Display 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 Universal Display are associated (or correlated) with Scientific Games. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scientific Games has no effect on the direction of Universal Display i.e., Universal Display and Scientific Games go up and down completely randomly.
Pair Corralation between Universal Display and Scientific Games
Assuming the 90 days horizon Universal Display is expected to generate 1.2 times less return on investment than Scientific Games. In addition to that, Universal Display is 1.23 times more volatile than Scientific Games. It trades about 0.02 of its total potential returns per unit of risk. Scientific Games is currently generating about 0.03 per unit of volatility. If you would invest 7,900 in Scientific Games on August 24, 2024 and sell it today you would earn a total of 650.00 from holding Scientific Games or generate 8.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Universal Display vs. Scientific Games
Performance |
| Timeline |
| Universal Display |
| Scientific Games |
Universal Display and Scientific Games Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Universal Display and Scientific Games
The main advantage of trading using opposite Universal Display and Scientific Games positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Universal Display position performs unexpectedly, Scientific Games 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 Scientific Games will offset losses from the drop in Scientific Games' long position.| Universal Display vs. ASML HOLDING NY | Universal Display vs. Applied Materials | Universal Display vs. Lam Research | Universal Display vs. Superior Plus Corp |
| Scientific Games vs. Natural Health Trends | Scientific Games vs. DiamondRock Hospitality | Scientific Games vs. PLAY2CHILL SA ZY | Scientific Games vs. Universal Display |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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