Correlation Between Ultimus Managers and IShares Global

Can any of the company-specific risk be diversified away by investing in both Ultimus Managers and IShares Global 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 Ultimus Managers and IShares Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ultimus Managers Trust and iShares Global Timber, you can compare the effects of market volatilities on Ultimus Managers and IShares Global 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 Ultimus Managers with a short position of IShares Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ultimus Managers and IShares Global.

Diversification Opportunities for Ultimus Managers and IShares Global

-0.44

Correlation Coefficient

Ultimus Managers  IShares Global

Very good diversification

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

Pair Corralation between Ultimus Managers and IShares Global

Given the investment horizon of 90 days Ultimus Managers Trust is expected to generate 1.11 times more return on investment than IShares Global. However, Ultimus Managers is 1.11 times more volatile than iShares Global Timber. It trades about 0.05 of its potential returns per unit of risk. iShares Global Timber is currently generating about -0.24 per unit of risk. If you would invest  2,723  in Ultimus Managers Trust on October 9, 2024 and sell it today you would earn a total of  26.00  from holding Ultimus Managers Trust or generate 0.95% return on investment over 90 days.

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

Ultimus Managers Trust  vs.  iShares Global Timber

Ultimus Managers Trust

Risk-Adjusted Performance

9 of 100

OK

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

iShares Global Timber

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days iShares Global Timber has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Etf's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the fund shareholders.

Pair Trading with Ultimus Managers and IShares Global

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

The idea behind Ultimus Managers Trust and iShares Global Timber 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.