Correlation Between Ultimus Managers and Investment Managers

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

By analyzing existing cross correlation between Ultimus Managers Trust and Investment Managers Series, you can compare the effects of market volatilities on Ultimus Managers and Investment Managers 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 Ultimus Managers with a short position of Investment Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultimus Managers and Investment Managers.

Diversification Opportunities for Ultimus Managers and Investment Managers

-0.37

Correlation Coefficient

Ultimus Managers  Investment Managers

Very good diversification

The 3 months correlation between Ultimus and Investment is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Ultimus Managers Trust and Investment Managers Series in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Investment Managers and Ultimus Managers 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 Ultimus Managers Trust are associated (or correlated) with Investment Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Investment Managers has no effect on the direction of Ultimus Managers i.e., Ultimus Managers and Investment Managers go up and down completely randomly.

Pair Corralation between Ultimus Managers and Investment Managers

Given the investment horizon of 90 days Ultimus Managers Trust is expected to generate 0.83 times more return on investment than Investment Managers. However, Ultimus Managers Trust is 1.21 times less risky than Investment Managers. It trades about 0.22 of its potential returns per unit of risk. Investment Managers Series is currently generating about 0.0 per unit of risk. If you would invest  2,517  in Ultimus Managers Trust on September 3, 2024 and sell it today you would earn a total of  304.00  from holding Ultimus Managers Trust or generate 12.08% return on investment over 90 days.

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

Ultimus Managers Trust  vs.  Investment Managers Series

Ultimus Managers Trust

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ultimus Managers Trust are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Ultimus Managers may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Investment Managers

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Investment Managers Series has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Investment Managers is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Ultimus Managers and Investment Managers

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

The idea behind Ultimus Managers Trust and Investment Managers Series 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.