Correlation Between Universal Technical and Douglas Emmett

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

By analyzing existing cross correlation between Universal Technical Institute and Douglas Emmett, you can compare the effects of market volatilities on Universal Technical and Douglas Emmett 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 Universal Technical with a short position of Douglas Emmett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Technical and Douglas Emmett.

Diversification Opportunities for Universal Technical and Douglas Emmett

-0.34

Correlation Coefficient

Universal Technical  Douglas Emmett

Very good diversification

The 3 months correlation between Universal and Douglas is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Universal Technical Institute and Douglas Emmett in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Douglas Emmett and Universal Technical 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 Universal Technical Institute are associated (or correlated) with Douglas Emmett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Douglas Emmett has no effect on the direction of Universal Technical i.e., Universal Technical and Douglas Emmett go up and down completely randomly.

Pair Corralation between Universal Technical and Douglas Emmett

Considering the 90-day investment horizon Universal Technical Institute is expected to under-perform the Douglas Emmett. In addition to that, Universal Technical is 1.82 times more volatile than Douglas Emmett. It trades about -0.14 of its total potential returns per unit of risk. Douglas Emmett is currently generating about 0.02 per unit of volatility. If you would invest  1,474  in Douglas Emmett on May 16, 2025 and sell it today you would earn a total of  21.00  from holding Douglas Emmett or generate 1.42% return on investment over 90 days.

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

Universal Technical Institute  vs.  Douglas Emmett

Universal Technical

Risk-Adjusted Performance

Weakest

Over the last 90 days Universal Technical Institute has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in September 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Douglas Emmett

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Douglas Emmett are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong technical and fundamental indicators, Douglas Emmett is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Universal Technical and Douglas Emmett

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

The idea behind Universal Technical Institute and Douglas Emmett 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.