Correlation Between Aptiv PLC and U Power
Can any of the company-specific risk be diversified away by investing in both Aptiv PLC and U Power 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 Aptiv PLC and U Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aptiv PLC and U Power Limited, you can compare the effects of market volatilities on Aptiv PLC and U Power 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 Aptiv PLC with a short position of U Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aptiv PLC and U Power.
Diversification Opportunities for Aptiv PLC and U Power
Excellent diversification
The 3 months correlation between Aptiv and UCAR is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Aptiv PLC and U Power Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Power Limited and Aptiv PLC 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 Aptiv PLC are associated (or correlated) with U Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Power Limited has no effect on the direction of Aptiv PLC i.e., Aptiv PLC and U Power go up and down completely randomly.
Pair Corralation between Aptiv PLC and U Power
Given the investment horizon of 90 days Aptiv PLC is expected to generate 0.15 times more return on investment than U Power. However, Aptiv PLC is 6.66 times less risky than U Power. It trades about 0.11 of its potential returns per unit of risk. U Power Limited is currently generating about -0.14 per unit of risk. If you would invest 6,417 in Aptiv PLC on November 28, 2024 and sell it today you would earn a total of 205.00 from holding Aptiv PLC or generate 3.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aptiv PLC vs. U Power Limited
Performance |
| Timeline |
| Aptiv PLC |
| U Power Limited |
Aptiv PLC and U Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aptiv PLC and U Power
The main advantage of trading using opposite Aptiv PLC and U Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aptiv PLC position performs unexpectedly, U Power 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 U Power will offset losses from the drop in U Power's long position.| Aptiv PLC vs. Allison Transmission Holdings | Aptiv PLC vs. LKQ Corporation | Aptiv PLC vs. Lear Corporation | Aptiv PLC vs. Magna International |
| U Power vs. Kaixin Auto Holdings | U Power vs. Uxin | U Power vs. SunCar Technology Group | U Power vs. Carvana Co |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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