Correlation Between Universal Display and Team Internet

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

By analyzing existing cross correlation between Universal Display Corp and Team Internet Group, you can compare the effects of market volatilities on Universal Display and Team Internet 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 Universal Display with a short position of Team Internet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Display and Team Internet.

Diversification Opportunities for Universal Display and Team Internet

0.69

Correlation Coefficient

Universal Display  Team Internet

Poor diversification

The 3 months correlation between Universal and Team is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Universal Display Corp and Team Internet Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Team Internet Group and Universal Display 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 Universal Display Corp are associated (or correlated) with Team Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Team Internet Group has no effect on the direction of Universal Display i.e., Universal Display and Team Internet go up and down completely randomly.

Pair Corralation between Universal Display and Team Internet

Assuming the 90 days trading horizon Universal Display Corp is expected to generate 1.1 times more return on investment than Team Internet. However, Universal Display is 1.1 times more volatile than Team Internet Group. It trades about 0.16 of its potential returns per unit of risk. Team Internet Group is currently generating about 0.14 per unit of risk. If you would invest  11,525  in Universal Display Corp on April 20, 2025 and sell it today you would earn a total of  3,573  from holding Universal Display Corp or generate 31.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	95.16%
Values	Daily Returns

Universal Display Corp  vs.  Team Internet Group

Universal Display Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Universal Display Corp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Universal Display unveiled solid returns over the last few months and may actually be approaching a breakup point.

Team Internet Group

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Team Internet Group are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Team Internet exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Universal Display and Team Internet

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

The idea behind Universal Display Corp and Team Internet Group 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.