Correlation Between UBS AG and Meta Platforms
Can any of the company-specific risk be diversified away by investing in both UBS AG and Meta Platforms 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 UBS AG and Meta Platforms into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBS AG London and Meta Platforms, you can compare the effects of market volatilities on UBS AG and Meta Platforms 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 UBS AG with a short position of Meta Platforms. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS AG and Meta Platforms.
Diversification Opportunities for UBS AG and Meta Platforms
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between UBS and Meta is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding UBS AG London and Meta Platforms in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meta Platforms and UBS AG 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 UBS AG London are associated (or correlated) with Meta Platforms. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meta Platforms has no effect on the direction of UBS AG i.e., UBS AG and Meta Platforms go up and down completely randomly.
Pair Corralation between UBS AG and Meta Platforms
Given the investment horizon of 90 days UBS AG London is expected to generate 0.31 times more return on investment than Meta Platforms. However, UBS AG London is 3.26 times less risky than Meta Platforms. It trades about 0.07 of its potential returns per unit of risk. Meta Platforms is currently generating about -0.08 per unit of risk. If you would invest 1,581 in UBS AG London on December 30, 2023 and sell it today you would earn a total of 834.00 from holding UBS AG London or generate 52.75% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 10.93% |
Values | Daily Returns |
UBS AG London vs. Meta Platforms
Performance |
Timeline |
UBS AG London |
Meta Platforms |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
UBS AG and Meta Platforms Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with UBS AG and Meta Platforms
The main advantage of trading using opposite UBS AG and Meta Platforms positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBS AG position performs unexpectedly, Meta Platforms 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 Meta Platforms will offset losses from the drop in Meta Platforms' long position.UBS AG vs. Drum Income Plus | UBS AG vs. EA Series Trust | UBS AG vs. Global X MLP | UBS AG vs. ETRACS Quarterly Pay |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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