Correlation Between Invesco EQQQ and UBS CH

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

By analyzing existing cross correlation between Invesco EQQQ NASDAQ 100 and UBS CH Property, you can compare the effects of market volatilities on Invesco EQQQ and UBS CH 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 Invesco EQQQ with a short position of UBS CH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco EQQQ and UBS CH.

Diversification Opportunities for Invesco EQQQ and UBS CH

-0.44

Correlation Coefficient

Invesco EQQQ  UBS CH

Very good diversification

The 3 months correlation between Invesco and UBS is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Invesco EQQQ NASDAQ 100 and UBS CH Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UBS CH Property and Invesco EQQQ 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 Invesco EQQQ NASDAQ 100 are associated (or correlated) with UBS CH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UBS CH Property has no effect on the direction of Invesco EQQQ i.e., Invesco EQQQ and UBS CH go up and down completely randomly.

Pair Corralation between Invesco EQQQ and UBS CH

Assuming the 90 days trading horizon Invesco EQQQ NASDAQ 100 is expected to generate 0.87 times more return on investment than UBS CH. However, Invesco EQQQ NASDAQ 100 is 1.15 times less risky than UBS CH. It trades about 0.12 of its potential returns per unit of risk. UBS CH Property is currently generating about 0.04 per unit of risk. If you would invest  19,070  in Invesco EQQQ NASDAQ 100 on September 28, 2024 and sell it today you would earn a total of  17,375  from holding Invesco EQQQ NASDAQ 100 or generate 91.11% return on investment over 90 days.

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

Invesco EQQQ NASDAQ 100  vs.  UBS CH Property

Invesco EQQQ NASDAQ

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Invesco EQQQ NASDAQ 100 are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Invesco EQQQ may actually be approaching a critical reversion point that can send shares even higher in January 2025.

UBS CH Property

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Invesco EQQQ and UBS CH

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

The idea behind Invesco EQQQ NASDAQ 100 and UBS CH Property 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.