Correlation Between Autoneum Holding and UBS PF

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

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

Diversification Opportunities for Autoneum Holding and UBS PF

0.37

Correlation Coefficient

Autoneum Holding  UBS PF

Weak diversification

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

Pair Corralation between Autoneum Holding and UBS PF

Assuming the 90 days trading horizon Autoneum Holding is expected to generate 1.23 times less return on investment than UBS PF. In addition to that, Autoneum Holding is 1.32 times more volatile than UBS PF Swiss. It trades about 0.06 of its total potential returns per unit of risk. UBS PF Swiss is currently generating about 0.1 per unit of volatility. If you would invest  14,900  in UBS PF Swiss on October 24, 2024 and sell it today you would earn a total of  940.00  from holding UBS PF Swiss or generate 6.31% return on investment over 90 days.

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

Autoneum Holding AG  vs.  UBS PF Swiss

Autoneum Holding

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Autoneum Holding AG are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Autoneum Holding is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

UBS PF Swiss

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in UBS PF Swiss are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly unfluctuating basic indicators, UBS PF may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Autoneum Holding and UBS PF

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

The idea behind Autoneum Holding AG and UBS PF Swiss 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.