Correlation Between EZGO Technologies and UDR
Can any of the company-specific risk be diversified away by investing in both EZGO Technologies and UDR 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 EZGO Technologies and UDR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EZGO Technologies and UDR Inc, you can compare the effects of market volatilities on EZGO Technologies and UDR 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 EZGO Technologies with a short position of UDR. Check out your portfolio center. Please also check ongoing floating volatility patterns of EZGO Technologies and UDR.
Diversification Opportunities for EZGO Technologies and UDR
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between EZGO and UDR is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding EZGO Technologies and UDR Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UDR Inc and EZGO Technologies 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 EZGO Technologies are associated (or correlated) with UDR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UDR Inc has no effect on the direction of EZGO Technologies i.e., EZGO Technologies and UDR go up and down completely randomly.
Pair Corralation between EZGO Technologies and UDR
Given the investment horizon of 90 days EZGO Technologies is expected to under-perform the UDR. In addition to that, EZGO Technologies is 4.33 times more volatile than UDR Inc. It trades about -0.13 of its total potential returns per unit of risk. UDR Inc is currently generating about 0.07 per unit of volatility. If you would invest 4,490 in UDR Inc on August 31, 2024 and sell it today you would earn a total of 143.00 from holding UDR Inc or generate 3.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EZGO Technologies vs. UDR Inc
Performance |
| Timeline |
| EZGO Technologies |
| UDR Inc |
EZGO Technologies and UDR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EZGO Technologies and UDR
The main advantage of trading using opposite EZGO Technologies and UDR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EZGO Technologies position performs unexpectedly, UDR 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 UDR will offset losses from the drop in UDR's long position.| EZGO Technologies vs. Vision Marine Technologies | EZGO Technologies vs. Marine Products | EZGO Technologies vs. Thor Industries | EZGO Technologies vs. BRP Inc |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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