Correlation Between Ultimus Managers and Westwood High
Can any of the company-specific risk be diversified away by investing in both Ultimus Managers and Westwood High 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 Ultimus Managers and Westwood High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ultimus Managers Trust and Westwood High Income, you can compare the effects of market volatilities on Ultimus Managers and Westwood High 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 Ultimus Managers with a short position of Westwood High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultimus Managers and Westwood High.
Diversification Opportunities for Ultimus Managers and Westwood High
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ultimus and Westwood is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Ultimus Managers Trust and Westwood High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westwood High Income and Ultimus Managers 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 Ultimus Managers Trust are associated (or correlated) with Westwood High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westwood High Income has no effect on the direction of Ultimus Managers i.e., Ultimus Managers and Westwood High go up and down completely randomly.
Pair Corralation between Ultimus Managers and Westwood High
Assuming the 90 days horizon Ultimus Managers Trust is expected to generate 2.52 times more return on investment than Westwood High. However, Ultimus Managers is 2.52 times more volatile than Westwood High Income. It trades about 0.07 of its potential returns per unit of risk. Westwood High Income is currently generating about 0.11 per unit of risk. If you would invest 975.00 in Ultimus Managers Trust on August 31, 2024 and sell it today you would earn a total of 286.00 from holding Ultimus Managers Trust or generate 29.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ultimus Managers Trust vs. Westwood High Income
Performance |
| Timeline |
| Ultimus Managers Trust |
| Westwood High Income |
Ultimus Managers and Westwood High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ultimus Managers and Westwood High
The main advantage of trading using opposite Ultimus Managers and Westwood High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ultimus Managers position performs unexpectedly, Westwood High 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 Westwood High will offset losses from the drop in Westwood High's long position.| Ultimus Managers vs. Ultimus Managers Trust | Ultimus Managers vs. Prudential Jennison International | Ultimus Managers vs. Fidelity New Markets | Ultimus Managers vs. Ohio Variable College |
| Westwood High vs. T Rowe Price | Westwood High vs. Old Westbury Large | Westwood High vs. Qs Large Cap | Westwood High vs. Federated Kaufmann Large |
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 Stocks Directory module to find actively traded stocks across global markets.
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