Correlation Between UBS ETF and 21Shares Ethereum

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

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

Diversification Opportunities for UBS ETF and 21Shares Ethereum

-0.7

Correlation Coefficient

UBS ETF  21Shares Ethereum

Excellent diversification

The 3 months correlation between UBS and 21Shares is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding UBS ETF MSCI and 21Shares Ethereum Staking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Ethereum Staking and UBS ETF 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 ETF MSCI are associated (or correlated) with 21Shares Ethereum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Ethereum Staking has no effect on the direction of UBS ETF i.e., UBS ETF and 21Shares Ethereum go up and down completely randomly.

Pair Corralation between UBS ETF and 21Shares Ethereum

Assuming the 90 days trading horizon UBS ETF is expected to generate 8.64 times less return on investment than 21Shares Ethereum. But when comparing it to its historical volatility, UBS ETF MSCI is 4.75 times less risky than 21Shares Ethereum. It trades about 0.04 of its potential returns per unit of risk. 21Shares Ethereum Staking is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  1,713  in 21Shares Ethereum Staking on October 7, 2024 and sell it today you would earn a total of  2,251  from holding 21Shares Ethereum Staking or generate 131.41% return on investment over 90 days.

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

UBS ETF MSCI  vs.  21Shares Ethereum Staking

UBS ETF MSCI

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days UBS ETF MSCI has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, UBS ETF is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

21Shares Ethereum Staking

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in 21Shares Ethereum Staking are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, 21Shares Ethereum unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with UBS ETF and 21Shares Ethereum

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

The idea behind UBS ETF MSCI and 21Shares Ethereum Staking 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.