Correlation Between Plexus Corp and Ucommune International
Can any of the company-specific risk be diversified away by investing in both Plexus Corp 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 Plexus Corp and Ucommune International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Plexus Corp and Ucommune International, you can compare the effects of market volatilities on Plexus Corp 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 Plexus Corp with a short position of Ucommune International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Plexus Corp and Ucommune International.
Diversification Opportunities for Plexus Corp and Ucommune International
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Plexus and Ucommune is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Plexus Corp and Ucommune International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ucommune International and Plexus Corp 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 Plexus Corp 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 Plexus Corp i.e., Plexus Corp and Ucommune International go up and down completely randomly.
Pair Corralation between Plexus Corp and Ucommune International
Given the investment horizon of 90 days Plexus Corp is expected to generate 73.51 times less return on investment than Ucommune International. But when comparing it to its historical volatility, Plexus Corp is 61.89 times less risky than Ucommune International. It trades about 0.1 of its potential returns per unit of risk. Ucommune International is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 0.70 in Ucommune International on August 26, 2024 and sell it today you would earn a total of 0.30 from holding Ucommune International or generate 42.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 83.13% |
| Values | Daily Returns |
Plexus Corp vs. Ucommune International
Performance |
| Timeline |
| Plexus Corp |
| Ucommune International |
Plexus Corp and Ucommune International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Plexus Corp and Ucommune International
The main advantage of trading using opposite Plexus Corp and Ucommune International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Plexus Corp 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.| Plexus Corp vs. Celestica | Plexus Corp vs. Benchmark Electronics | Plexus Corp vs. Flex | Plexus Corp vs. Jabil Circuit |
| Ucommune International vs. Plexus Corp | Ucommune International vs. Benchmark Electronics | Ucommune International vs. Jabil Circuit | Ucommune International vs. Sanmina |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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