Correlation Between Visa and UBS Fund
Can any of the company-specific risk be diversified away by investing in both Visa and UBS Fund 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 Visa and UBS Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Visa Class A and UBS Fund Solutions, you can compare the effects of market volatilities on Visa and UBS Fund 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 Visa with a short position of UBS Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Visa and UBS Fund.
Diversification Opportunities for Visa and UBS Fund
Average diversification
The 3 months correlation between Visa and UBS is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Visa Class A and UBS Fund Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS Fund Solutions and Visa 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 Visa Class A are associated (or correlated) with UBS Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS Fund Solutions has no effect on the direction of Visa i.e., Visa and UBS Fund go up and down completely randomly.
Pair Corralation between Visa and UBS Fund
Taking into account the 90-day investment horizon Visa Class A is expected to under-perform the UBS Fund. In addition to that, Visa is 1.04 times more volatile than UBS Fund Solutions. It trades about -0.04 of its total potential returns per unit of risk. UBS Fund Solutions is currently generating about 0.13 per unit of volatility. If you would invest 4,808 in UBS Fund Solutions on February 4, 2024 and sell it today you would earn a total of 313.00 from holding UBS Fund Solutions or generate 6.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 98.41% |
Values | Daily Returns |
Visa Class A vs. UBS Fund Solutions
Performance |
Timeline |
Visa Class A |
UBS Fund Solutions |
Visa and UBS Fund Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Visa and UBS Fund
The main advantage of trading using opposite Visa and UBS Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Visa position performs unexpectedly, UBS Fund 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 Fund will offset losses from the drop in UBS Fund's long position.The idea behind Visa Class A and UBS Fund Solutions 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.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 Commodity Directory module to find actively traded commodities issued by global exchanges.
Other Complementary Tools
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |