Correlation Between U Power and BTB Real
Can any of the company-specific risk be diversified away by investing in both U Power and BTB Real 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 U Power and BTB Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between U Power Limited and BTB Real Estate, you can compare the effects of market volatilities on U Power and BTB Real 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 U Power with a short position of BTB Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of U Power and BTB Real.
Diversification Opportunities for U Power and BTB Real
Weak diversification
The 3 months correlation between UCAR and BTB is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding U Power Limited and BTB Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTB Real Estate and U Power 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 U Power Limited are associated (or correlated) with BTB Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTB Real Estate has no effect on the direction of U Power i.e., U Power and BTB Real go up and down completely randomly.
Pair Corralation between U Power and BTB Real
Given the investment horizon of 90 days U Power Limited is expected to generate 10.9 times more return on investment than BTB Real. However, U Power is 10.9 times more volatile than BTB Real Estate. It trades about 0.05 of its potential returns per unit of risk. BTB Real Estate is currently generating about 0.03 per unit of risk. If you would invest 0.00 in U Power Limited on September 2, 2024 and sell it today you would earn a total of 632.00 from holding U Power Limited or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.07% |
| Values | Daily Returns |
U Power Limited vs. BTB Real Estate
Performance |
| Timeline |
| U Power Limited |
| BTB Real Estate |
U Power and BTB Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with U Power and BTB Real
The main advantage of trading using opposite U Power and BTB Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if U Power position performs unexpectedly, BTB Real 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 BTB Real will offset losses from the drop in BTB Real's long position.| U Power vs. Advance Auto Parts | U Power vs. Tractor Supply | U Power vs. Genuine Parts Co | U Power vs. Five Below |
| BTB Real vs. Boston Properties | BTB Real vs. Kilroy Realty Corp | BTB Real vs. SL Green Realty | BTB Real vs. Vornado Realty Trust |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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