Correlation Between UBS ETF and 21Shares Tezos

Can any of the company-specific risk be diversified away by investing in both UBS ETF and 21Shares Tezos 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 Tezos 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 Tezos staking, you can compare the effects of market volatilities on UBS ETF and 21Shares Tezos 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 Tezos. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS ETF and 21Shares Tezos.

Diversification Opportunities for UBS ETF and 21Shares Tezos

-0.59

Correlation Coefficient

UBS ETF  21Shares Tezos

Excellent diversification

The 3 months correlation between UBS and 21Shares is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding UBS ETF MSCI and 21Shares Tezos staking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 21Shares Tezos 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 Tezos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 21Shares Tezos staking has no effect on the direction of UBS ETF i.e., UBS ETF and 21Shares Tezos go up and down completely randomly.

Pair Corralation between UBS ETF and 21Shares Tezos

Assuming the 90 days trading horizon UBS ETF MSCI is expected to generate 0.1 times more return on investment than 21Shares Tezos. However, UBS ETF MSCI is 10.51 times less risky than 21Shares Tezos. It trades about -0.1 of its potential returns per unit of risk. 21Shares Tezos staking is currently generating about -0.11 per unit of risk. If you would invest  2,002  in UBS ETF MSCI on October 7, 2024 and sell it today you would lose (22.00) from holding UBS ETF MSCI or give up 1.1% of portfolio value over 90 days.

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

UBS ETF MSCI  vs.  21Shares Tezos 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 Tezos staking

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in 21Shares Tezos staking are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, 21Shares Tezos showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with UBS ETF and 21Shares Tezos

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

The idea behind UBS ETF MSCI and 21Shares Tezos 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.

Check out your portfolio center.

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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.