Correlation Between 21Shares Polkadot and UBSFund Solutions

Can any of the company-specific risk be diversified away by investing in both 21Shares Polkadot and UBSFund Solutions 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 21Shares Polkadot and UBSFund Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 21Shares Polkadot ETP and UBSFund Solutions MSCI, you can compare the effects of market volatilities on 21Shares Polkadot and UBSFund Solutions 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 21Shares Polkadot with a short position of UBSFund Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of 21Shares Polkadot and UBSFund Solutions.

Diversification Opportunities for 21Shares Polkadot and UBSFund Solutions

-0.31

Correlation Coefficient

21Shares Polkadot  UBSFund Solutions

Very good diversification

The 3 months correlation between 21Shares and UBSFund is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding 21Shares Polkadot ETP and UBSFund Solutions MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBSFund Solutions MSCI and 21Shares Polkadot 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 21Shares Polkadot ETP are associated (or correlated) with UBSFund Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBSFund Solutions MSCI has no effect on the direction of 21Shares Polkadot i.e., 21Shares Polkadot and UBSFund Solutions go up and down completely randomly.

Pair Corralation between 21Shares Polkadot and UBSFund Solutions

Assuming the 90 days trading horizon 21Shares Polkadot ETP is expected to under-perform the UBSFund Solutions. In addition to that, 21Shares Polkadot is 6.16 times more volatile than UBSFund Solutions MSCI. It trades about -0.03 of its total potential returns per unit of risk. UBSFund Solutions MSCI is currently generating about 0.04 per unit of volatility. If you would invest  1,070  in UBSFund Solutions MSCI on December 2, 2024 and sell it today you would earn a total of  91.00  from holding UBSFund Solutions MSCI or generate 8.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.78%
Values	Daily Returns

21Shares Polkadot ETP  vs.  UBSFund Solutions MSCI

21Shares Polkadot ETP

Risk-Adjusted Performance

Very Weak

Over the last 90 days 21Shares Polkadot ETP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Etf's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the fund sophisticated investors.

UBSFund Solutions MSCI

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in UBSFund Solutions MSCI are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong primary indicators, UBSFund Solutions is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with 21Shares Polkadot and UBSFund Solutions

The main advantage of trading using opposite 21Shares Polkadot and UBSFund Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 21Shares Polkadot position performs unexpectedly, UBSFund Solutions 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 UBSFund Solutions will offset losses from the drop in UBSFund Solutions' long position.

The idea behind 21Shares Polkadot ETP and UBSFund Solutions MSCI 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.