Correlation Between Performance Shipping and Ucommune International
Can any of the company-specific risk be diversified away by investing in both Performance Shipping 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 Performance Shipping and Ucommune International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Performance Shipping and Ucommune International, you can compare the effects of market volatilities on Performance Shipping 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 Performance Shipping with a short position of Ucommune International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Performance Shipping and Ucommune International.
Diversification Opportunities for Performance Shipping and Ucommune International
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Performance and Ucommune is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Performance Shipping and Ucommune International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ucommune International and Performance Shipping 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 Performance Shipping 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 Performance Shipping i.e., Performance Shipping and Ucommune International go up and down completely randomly.
Pair Corralation between Performance Shipping and Ucommune International
Given the investment horizon of 90 days Performance Shipping is expected to under-perform the Ucommune International. But the stock apears to be less risky and, when comparing its historical volatility, Performance Shipping is 5.5 times less risky than Ucommune International. The stock trades about -0.07 of its potential returns per unit of risk. The Ucommune International is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1.03 in Ucommune International on August 26, 2024 and sell it today you would lose (0.03) from holding Ucommune International or give up 2.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 77.27% |
| Values | Daily Returns |
Performance Shipping vs. Ucommune International
Performance |
| Timeline |
| Performance Shipping |
| Ucommune International |
Performance Shipping and Ucommune International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Performance Shipping and Ucommune International
The main advantage of trading using opposite Performance Shipping and Ucommune International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Performance Shipping 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.| Performance Shipping vs. Genco Shipping Trading | Performance Shipping vs. Golden Ocean Group | Performance Shipping vs. Star Bulk Carriers | Performance Shipping vs. Oceanpal |
| 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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