Correlation Between UWM Holdings and OFS Credit

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both UWM Holdings and OFS Credit 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 UWM Holdings and OFS Credit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UWM Holdings Corp and OFS Credit, you can compare the effects of market volatilities on UWM Holdings and OFS Credit 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 UWM Holdings with a short position of OFS Credit. Check out your portfolio center. Please also check ongoing floating volatility patterns of UWM Holdings and OFS Credit.

Diversification Opportunities for UWM Holdings and OFS Credit

-0.03
  Correlation Coefficient

Good diversification

The 3 months correlation between UWM and OFS is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding UWM Holdings Corp and OFS Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFS Credit and UWM Holdings 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 UWM Holdings Corp are associated (or correlated) with OFS Credit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFS Credit has no effect on the direction of UWM Holdings i.e., UWM Holdings and OFS Credit go up and down completely randomly.

Pair Corralation between UWM Holdings and OFS Credit

Given the investment horizon of 90 days UWM Holdings is expected to generate 1.44 times less return on investment than OFS Credit. In addition to that, UWM Holdings is 2.53 times more volatile than OFS Credit. It trades about 0.02 of its total potential returns per unit of risk. OFS Credit is currently generating about 0.08 per unit of volatility. If you would invest  575.00  in OFS Credit on November 9, 2024 and sell it today you would earn a total of  138.00  from holding OFS Credit or generate 24.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

UWM Holdings Corp  vs.  OFS Credit

 Performance 
       Timeline  
UWM Holdings Corp 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in UWM Holdings Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound primary indicators, UWM Holdings is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.
OFS Credit 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in OFS Credit are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong fundamental indicators, OFS Credit is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

UWM Holdings and OFS Credit Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with UWM Holdings and OFS Credit

The main advantage of trading using opposite UWM Holdings and OFS Credit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UWM Holdings position performs unexpectedly, OFS Credit 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 OFS Credit will offset losses from the drop in OFS Credit's long position.
The idea behind UWM Holdings Corp and OFS Credit pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.

Other Complementary Tools

Performance Analysis
Check effects of mean-variance optimization against your current asset allocation
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Portfolio Suggestion
Get suggestions outside of your existing asset allocation including your own model portfolios
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like