Correlation Between UBS and IShares Financials
Can any of the company-specific risk be diversified away by investing in both UBS and IShares Financials 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 UBS and IShares Financials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBS and iShares Financials ETF, you can compare the effects of market volatilities on UBS and IShares Financials 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 UBS with a short position of IShares Financials. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS and IShares Financials.
Diversification Opportunities for UBS and IShares Financials
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between UBS and IShares is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding UBS and iShares Financials ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Financials ETF and UBS 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 UBS are associated (or correlated) with IShares Financials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Financials ETF has no effect on the direction of UBS i.e., UBS and IShares Financials go up and down completely randomly.
Pair Corralation between UBS and IShares Financials
If you would invest 7,813 in iShares Financials ETF on January 24, 2024 and sell it today you would earn a total of 1,454 from holding iShares Financials ETF or generate 18.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
UBS vs. iShares Financials ETF
Performance |
| Timeline |
| UBS |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| iShares Financials ETF |
UBS and IShares Financials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UBS and IShares Financials
The main advantage of trading using opposite UBS and IShares Financials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBS position performs unexpectedly, IShares Financials 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 IShares Financials will offset losses from the drop in IShares Financials' long position.The idea behind UBS and iShares Financials ETF 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.| IShares Financials vs. Virtus InfraCap Preferred | IShares Financials vs. XAI Octagon Floating | IShares Financials vs. Amplify High Income | IShares Financials vs. Triplepoint Venture Growth |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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