Correlation Between CyberArk Software and U BX

Can any of the company-specific risk be diversified away by investing in both CyberArk Software and U BX 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 CyberArk Software and U BX into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CyberArk Software and U BX Technology Ltd, you can compare the effects of market volatilities on CyberArk Software and U BX 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 CyberArk Software with a short position of U BX. Check out your portfolio center. Please also check ongoing floating volatility patterns of CyberArk Software and U BX.

Diversification Opportunities for CyberArk Software and U BX

0.64

Correlation Coefficient

CyberArk Software  U BX

Poor diversification

The 3 months correlation between CyberArk and UBXG is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding CyberArk Software and U BX Technology Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U BX Technology and CyberArk Software 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 CyberArk Software are associated (or correlated) with U BX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U BX Technology has no effect on the direction of CyberArk Software i.e., CyberArk Software and U BX go up and down completely randomly.

Pair Corralation between CyberArk Software and U BX

Given the investment horizon of 90 days CyberArk Software is expected to generate 70.94 times less return on investment than U BX. But when comparing it to its historical volatility, CyberArk Software is 62.6 times less risky than U BX. It trades about 0.1 of its potential returns per unit of risk. U BX Technology Ltd is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  68.00  in U BX Technology Ltd on September 21, 2024 and sell it today you would earn a total of  271.00  from holding U BX Technology Ltd or generate 398.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

CyberArk Software  vs.  U BX Technology Ltd

CyberArk Software

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in CyberArk Software are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal fundamental drivers, CyberArk Software reported solid returns over the last few months and may actually be approaching a breakup point.

U BX Technology

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in U BX Technology Ltd are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, U BX reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CyberArk Software and U BX

The main advantage of trading using opposite CyberArk Software and U BX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CyberArk Software position performs unexpectedly, U BX 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 U BX will offset losses from the drop in U BX's long position.

The idea behind CyberArk Software and U BX Technology Ltd 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.