Correlation Between Unitronix and IBEX

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

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

Diversification Opportunities for Unitronix and IBEX

0.22

Correlation Coefficient

Unitronix  IBEX

Modest diversification

The 3 months correlation between Unitronix and IBEX is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Unitronix and IBEX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IBEX and Unitronix 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 Unitronix are associated (or correlated) with IBEX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IBEX has no effect on the direction of Unitronix i.e., Unitronix and IBEX go up and down completely randomly.

Pair Corralation between Unitronix and IBEX

Given the investment horizon of 90 days Unitronix is expected to generate 13.0 times more return on investment than IBEX. However, Unitronix is 13.0 times more volatile than IBEX. It trades about 0.13 of its potential returns per unit of risk. IBEX is currently generating about 0.11 per unit of risk. If you would invest  1.60  in Unitronix on April 29, 2025 and sell it today you would earn a total of  1.20  from holding Unitronix or generate 75.0% return on investment over 90 days.

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

Unitronix  vs.  IBEX

Unitronix

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Unitronix are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, Unitronix showed solid returns over the last few months and may actually be approaching a breakup point.

IBEX

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in IBEX are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, IBEX showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Unitronix and IBEX

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

The idea behind Unitronix and IBEX 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.