Correlation Between UBS and VanEck Oil

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

By analyzing existing cross correlation between UBS and VanEck Oil Refiners, you can compare the effects of market volatilities on UBS and VanEck Oil 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 with a short position of VanEck Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS and VanEck Oil.

Diversification Opportunities for UBS and VanEck Oil

0.0

Correlation Coefficient

UBS  VanEck Oil

Pay attention - limited upside

The 3 months correlation between UBS and VanEck is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding UBS and VanEck Oil Refiners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Oil Refiners and UBS 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 are associated (or correlated) with VanEck Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Oil Refiners has no effect on the direction of UBS i.e., UBS and VanEck Oil go up and down completely randomly.

Pair Corralation between UBS and VanEck Oil

If you would invest  2,746  in VanEck Oil Refiners on December 27, 2024 and sell it today you would earn a total of  194.00  from holding VanEck Oil Refiners or generate 7.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

UBS  vs.  VanEck Oil Refiners

UBS

Risk-Adjusted Performance

Very Weak

Over the last 90 days UBS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, UBS is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

VanEck Oil Refiners

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck Oil Refiners are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, VanEck Oil may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with UBS and VanEck Oil

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

The idea behind UBS and VanEck Oil Refiners 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.