Correlation Between UNIVERSAL DISPLAY and CALTAGIRONE EDITORE

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

By analyzing existing cross correlation between UNIVERSAL DISPLAY and CALTAGIRONE EDITORE, you can compare the effects of market volatilities on UNIVERSAL DISPLAY and CALTAGIRONE EDITORE 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 CALTAGIRONE EDITORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNIVERSAL DISPLAY and CALTAGIRONE EDITORE.

Diversification Opportunities for UNIVERSAL DISPLAY and CALTAGIRONE EDITORE

0.28

Correlation Coefficient

UNIVERSAL DISPLAY  CALTAGIRONE EDITORE

Modest diversification

The 3 months correlation between UNIVERSAL and CALTAGIRONE is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding UNIVERSAL DISPLAY and CALTAGIRONE EDITORE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CALTAGIRONE EDITORE 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 are associated (or correlated) with CALTAGIRONE EDITORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CALTAGIRONE EDITORE has no effect on the direction of UNIVERSAL DISPLAY i.e., UNIVERSAL DISPLAY and CALTAGIRONE EDITORE go up and down completely randomly.

Pair Corralation between UNIVERSAL DISPLAY and CALTAGIRONE EDITORE

Assuming the 90 days trading horizon UNIVERSAL DISPLAY is expected to under-perform the CALTAGIRONE EDITORE. In addition to that, UNIVERSAL DISPLAY is 1.77 times more volatile than CALTAGIRONE EDITORE. It trades about -0.02 of its total potential returns per unit of risk. CALTAGIRONE EDITORE is currently generating about -0.02 per unit of volatility. If you would invest  145.00  in CALTAGIRONE EDITORE on March 22, 2025 and sell it today you would lose (6.00) from holding CALTAGIRONE EDITORE or give up 4.14% of portfolio value over 90 days.

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

UNIVERSAL DISPLAY  vs.  CALTAGIRONE EDITORE

UNIVERSAL DISPLAY

Risk-Adjusted Performance

Very Weak

Over the last 90 days UNIVERSAL DISPLAY has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable fundamental indicators, UNIVERSAL DISPLAY is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

CALTAGIRONE EDITORE

Risk-Adjusted Performance

Very Weak

Over the last 90 days CALTAGIRONE EDITORE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, CALTAGIRONE EDITORE is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with UNIVERSAL DISPLAY and CALTAGIRONE EDITORE

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

The idea behind UNIVERSAL DISPLAY and CALTAGIRONE EDITORE 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.