Correlation Between Western Assets and Ubs Pace
Can any of the company-specific risk be diversified away by investing in both Western Assets and Ubs Pace 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 Western Assets and Ubs Pace into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Assets Emerging and Ubs Pace Global, you can compare the effects of market volatilities on Western Assets and Ubs Pace 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 Western Assets with a short position of Ubs Pace. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Assets and Ubs Pace.
Diversification Opportunities for Western Assets and Ubs Pace
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Western and Ubs is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Western Assets Emerging and Ubs Pace Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ubs Pace Global and Western Assets 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 Western Assets Emerging are associated (or correlated) with Ubs Pace. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ubs Pace Global has no effect on the direction of Western Assets i.e., Western Assets and Ubs Pace go up and down completely randomly.
Pair Corralation between Western Assets and Ubs Pace
Assuming the 90 days horizon Western Assets Emerging is expected to generate 0.44 times more return on investment than Ubs Pace. However, Western Assets Emerging is 2.25 times less risky than Ubs Pace. It trades about 0.09 of its potential returns per unit of risk. Ubs Pace Global is currently generating about -0.16 per unit of risk. If you would invest 1,083 in Western Assets Emerging on September 12, 2024 and sell it today you would earn a total of 6.00 from holding Western Assets Emerging or generate 0.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Western Assets Emerging vs. Ubs Pace Global
Performance |
| Timeline |
| Western Assets Emerging |
| Ubs Pace Global |
Western Assets and Ubs Pace Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Assets and Ubs Pace
The main advantage of trading using opposite Western Assets and Ubs Pace positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Assets position performs unexpectedly, Ubs Pace 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 Pace will offset losses from the drop in Ubs Pace's long position.| Western Assets vs. Cb Large Cap | Western Assets vs. American Mutual Fund | Western Assets vs. Americafirst Large Cap | Western Assets vs. Dodge Cox Stock |
| Ubs Pace vs. Locorr Dynamic Equity | Ubs Pace vs. Gmo Global Equity | Ubs Pace vs. Rbc Global Equity | Ubs Pace vs. Qs International Equity |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |