Correlation Between FLEX LNG and Ucommune International
Can any of the company-specific risk be diversified away by investing in both FLEX LNG and Ucommune International 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 FLEX LNG and Ucommune International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FLEX LNG and Ucommune International, you can compare the effects of market volatilities on FLEX LNG and Ucommune International 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 FLEX LNG with a short position of Ucommune International. Check out your portfolio center. Please also check ongoing floating volatility patterns of FLEX LNG and Ucommune International.
Diversification Opportunities for FLEX LNG and Ucommune International
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between FLEX and Ucommune is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding FLEX LNG and Ucommune International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ucommune International and FLEX LNG 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 FLEX LNG are associated (or correlated) with Ucommune International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ucommune International has no effect on the direction of FLEX LNG i.e., FLEX LNG and Ucommune International go up and down completely randomly.
Pair Corralation between FLEX LNG and Ucommune International
Given the investment horizon of 90 days FLEX LNG is expected to generate 0.21 times more return on investment than Ucommune International. However, FLEX LNG is 4.82 times less risky than Ucommune International. It trades about 0.17 of its potential returns per unit of risk. Ucommune International is currently generating about -0.05 per unit of risk. If you would invest 2,466 in FLEX LNG on August 27, 2024 and sell it today you would earn a total of 168.00 from holding FLEX LNG or generate 6.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 90.48% |
| Values | Daily Returns |
FLEX LNG vs. Ucommune International
Performance |
| Timeline |
| FLEX LNG |
| Ucommune International |
FLEX LNG and Ucommune International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FLEX LNG and Ucommune International
The main advantage of trading using opposite FLEX LNG and Ucommune International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FLEX LNG position performs unexpectedly, Ucommune International 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 Ucommune International will offset losses from the drop in Ucommune International's long position.| FLEX LNG vs. Ucommune International | FLEX LNG vs. Lion Financial Group | FLEX LNG vs. HUMANA INC | FLEX LNG vs. Aquagold International |
| Ucommune International vs. Plexus Corp | Ucommune International vs. Jabil Circuit | Ucommune International vs. Sanmina | Ucommune International vs. Methode Electronics |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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