Correlation Between UBN and Cisco Systems
Can any of the company-specific risk be diversified away by investing in both UBN and Cisco Systems 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 UBN and Cisco Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBN and Cisco Systems, you can compare the effects of market volatilities on UBN and Cisco Systems 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 UBN with a short position of Cisco Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBN and Cisco Systems.
Diversification Opportunities for UBN and Cisco Systems
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between UBN and Cisco is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding UBN and Cisco Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cisco Systems and UBN 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 UBN are associated (or correlated) with Cisco Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cisco Systems has no effect on the direction of UBN i.e., UBN and Cisco Systems go up and down completely randomly.
Pair Corralation between UBN and Cisco Systems
If you would invest (100.00) in UBN on January 20, 2024 and sell it today you would earn a total of 100.00 from holding UBN or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
UBN vs. Cisco Systems
Performance |
| Timeline |
| UBN |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Cisco Systems |
UBN and Cisco Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UBN and Cisco Systems
The main advantage of trading using opposite UBN and Cisco Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBN position performs unexpectedly, Cisco Systems 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 Cisco Systems will offset losses from the drop in Cisco Systems' long position.The idea behind UBN and Cisco Systems 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.| Cisco Systems vs. Juniper Networks | Cisco Systems vs. Nokia Corp ADR | Cisco Systems vs. Motorola Solutions | Cisco Systems vs. Ciena Corp |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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