Correlation Between IncomeShares Apple and UBS Fund

Can any of the company-specific risk be diversified away by investing in both IncomeShares Apple 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 IncomeShares Apple and UBS Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between IncomeShares Apple Options and UBS Fund Solutions, you can compare the effects of market volatilities on IncomeShares Apple 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 IncomeShares Apple with a short position of UBS Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of IncomeShares Apple and UBS Fund.

Diversification Opportunities for IncomeShares Apple and UBS Fund

-0.34

Correlation Coefficient

IncomeShares Apple  UBS Fund

Very good diversification

The 3 months correlation between IncomeShares and UBS is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding IncomeShares Apple Options 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 IncomeShares Apple 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 IncomeShares Apple Options 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 IncomeShares Apple i.e., IncomeShares Apple and UBS Fund go up and down completely randomly.

Pair Corralation between IncomeShares Apple and UBS Fund

Assuming the 90 days trading horizon IncomeShares Apple Options is expected to generate 0.75 times more return on investment than UBS Fund. However, IncomeShares Apple Options is 1.33 times less risky than UBS Fund. It trades about 0.69 of its potential returns per unit of risk. UBS Fund Solutions is currently generating about 0.02 per unit of risk. If you would invest  938.00  in IncomeShares Apple Options on September 28, 2024 and sell it today you would earn a total of  135.00  from holding IncomeShares Apple Options or generate 14.39% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	45.16%
Values	Daily Returns

IncomeShares Apple Options  vs.  UBS Fund Solutions

IncomeShares Apple

Risk-Adjusted Performance

54 of 100

Excellent

Compared to the overall equity markets, risk-adjusted returns on investments in IncomeShares Apple Options are ranked lower than 54 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, IncomeShares Apple exhibited solid returns over the last few months and may actually be approaching a breakup point.

UBS Fund Solutions

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in UBS Fund Solutions are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable primary indicators, UBS Fund is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with IncomeShares Apple and UBS Fund

The main advantage of trading using opposite IncomeShares Apple and UBS Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IncomeShares Apple 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 IncomeShares Apple Options 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.

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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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.