Correlation Between Comet Holding and U Blox

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

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

Diversification Opportunities for Comet Holding and U Blox

-0.18

Correlation Coefficient

Comet Holding  U Blox

Good diversification

The 3 months correlation between Comet and UBXN is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Comet Holding AG and U Blox Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Blox Holding and Comet 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 Comet Holding AG are associated (or correlated) with U Blox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Blox Holding has no effect on the direction of Comet Holding i.e., Comet Holding and U Blox go up and down completely randomly.

Pair Corralation between Comet Holding and U Blox

Assuming the 90 days trading horizon Comet Holding AG is expected to under-perform the U Blox. In addition to that, Comet Holding is 1.04 times more volatile than U Blox Holding. It trades about -0.01 of its total potential returns per unit of risk. U Blox Holding is currently generating about 0.11 per unit of volatility. If you would invest  6,930  in U Blox Holding on December 20, 2024 and sell it today you would earn a total of  1,240  from holding U Blox Holding or generate 17.89% return on investment over 90 days.

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

Comet Holding AG  vs.  U Blox Holding

Comet Holding AG

Risk-Adjusted Performance

Very Weak

Over the last 90 days Comet Holding AG has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Comet Holding is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

U Blox Holding

Risk-Adjusted Performance

OK

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

Pair Trading with Comet Holding and U Blox

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

The idea behind Comet Holding AG and U Blox Holding 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.