Correlation Between Wells Fargo and UBS Group
Can any of the company-specific risk be diversified away by investing in both Wells Fargo and UBS Group 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 Wells Fargo and UBS Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wells Fargo and UBS Group AG, you can compare the effects of market volatilities on Wells Fargo and UBS Group 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 Wells Fargo with a short position of UBS Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wells Fargo and UBS Group.
Diversification Opportunities for Wells Fargo and UBS Group
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Wells and UBS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Wells Fargo and UBS Group AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS Group AG and Wells Fargo 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 Wells Fargo are associated (or correlated) with UBS Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS Group AG has no effect on the direction of Wells Fargo i.e., Wells Fargo and UBS Group go up and down completely randomly.
Pair Corralation between Wells Fargo and UBS Group
If you would invest 112,911 in Wells Fargo on August 29, 2024 and sell it today you would earn a total of 48,589 from holding Wells Fargo or generate 43.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Wells Fargo vs. UBS Group AG
Performance |
| Timeline |
| Wells Fargo |
| UBS Group AG |
Wells Fargo and UBS Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wells Fargo and UBS Group
The main advantage of trading using opposite Wells Fargo and UBS Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wells Fargo position performs unexpectedly, UBS Group 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 UBS Group will offset losses from the drop in UBS Group's long position.| Wells Fargo vs. CVS Health | Wells Fargo vs. DXC Technology | Wells Fargo vs. Genworth Financial | Wells Fargo vs. Grupo Carso SAB |
| UBS Group vs. Monster Beverage Corp | UBS Group vs. Grupo Sports World | UBS Group vs. Costco Wholesale | UBS Group vs. First Republic Bank |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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