Correlation Between UBS Money and Caixabank Seleccin

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Can any of the company-specific risk be diversified away by investing in both UBS Money and Caixabank Seleccin 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 Money and Caixabank Seleccin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UBS Money Market and Caixabank Seleccin Tendencias, you can compare the effects of market volatilities on UBS Money and Caixabank Seleccin 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 Money with a short position of Caixabank Seleccin. Check out your portfolio center. Please also check ongoing floating volatility patterns of UBS Money and Caixabank Seleccin.

Diversification Opportunities for UBS Money and Caixabank Seleccin

UBSCaixabankDiversified AwayUBSCaixabankDiversified Away100%
0.61
  Correlation Coefficient

Poor diversification

The 3 months correlation between UBS and Caixabank is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding UBS Money Market and Caixabank Seleccin Tendencias in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caixabank Seleccin and UBS Money 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 Money Market are associated (or correlated) with Caixabank Seleccin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caixabank Seleccin has no effect on the direction of UBS Money i.e., UBS Money and Caixabank Seleccin go up and down completely randomly.

Pair Corralation between UBS Money and Caixabank Seleccin

Assuming the 90 days trading horizon UBS Money Market is expected to generate 0.6 times more return on investment than Caixabank Seleccin. However, UBS Money Market is 1.68 times less risky than Caixabank Seleccin. It trades about 0.27 of its potential returns per unit of risk. Caixabank Seleccin Tendencias is currently generating about -0.11 per unit of risk. If you would invest  191,269  in UBS Money Market on October 11, 2024 and sell it today you would earn a total of  4,676  from holding UBS Money Market or generate 2.44% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy77.78%
ValuesDaily Returns

UBS Money Market  vs.  Caixabank Seleccin Tendencias

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -6-4-2024
JavaScript chart by amCharts 3.21.15UG72 0P0000XRHI
       Timeline  
UBS Money Market 

Risk-Adjusted Performance

21 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in UBS Money Market are ranked lower than 21 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather weak technical and fundamental indicators, UBS Money may actually be approaching a critical reversion point that can send shares even higher in February 2025.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan1,8201,8401,8601,8801,9001,9201,9401,9601,980
Caixabank Seleccin 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Weak
Over the last 90 days Caixabank Seleccin Tendencias has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Caixabank Seleccin is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

UBS Money and Caixabank Seleccin Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-1.24-0.88-0.52-0.160.05520.380.741.11.461.82 0.51.01.52.0
JavaScript chart by amCharts 3.21.15UG72 0P0000XRHI
       Returns  

Pair Trading with UBS Money and Caixabank Seleccin

The main advantage of trading using opposite UBS Money and Caixabank Seleccin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UBS Money position performs unexpectedly, Caixabank Seleccin 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 Caixabank Seleccin will offset losses from the drop in Caixabank Seleccin's long position.
The idea behind UBS Money Market and Caixabank Seleccin Tendencias 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.

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