Correlation Between U Power and Gyre Therapeutics
Can any of the company-specific risk be diversified away by investing in both U Power and Gyre Therapeutics 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 Gyre Therapeutics 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 Gyre Therapeutics, you can compare the effects of market volatilities on U Power and Gyre Therapeutics 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 Gyre Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of U Power and Gyre Therapeutics.
Diversification Opportunities for U Power and Gyre Therapeutics
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between UCAR and Gyre is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding U Power Limited and Gyre Therapeutics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gyre Therapeutics 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 Gyre Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gyre Therapeutics has no effect on the direction of U Power i.e., U Power and Gyre Therapeutics go up and down completely randomly.
Pair Corralation between U Power and Gyre Therapeutics
Given the investment horizon of 90 days U Power Limited is expected to generate 8.91 times more return on investment than Gyre Therapeutics. However, U Power is 8.91 times more volatile than Gyre Therapeutics. It trades about 0.05 of its potential returns per unit of risk. Gyre Therapeutics is currently generating about 0.0 per unit of risk. If you would invest 3,000 in U Power Limited on September 4, 2024 and sell it today you would lose (2,356) from holding U Power Limited or give up 78.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
U Power Limited vs. Gyre Therapeutics
Performance |
| Timeline |
| U Power Limited |
| Gyre Therapeutics |
U Power and Gyre Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with U Power and Gyre Therapeutics
The main advantage of trading using opposite U Power and Gyre Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if U Power position performs unexpectedly, Gyre Therapeutics 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 Gyre Therapeutics will offset losses from the drop in Gyre Therapeutics' long position.| U Power vs. Sonic Automotive | U Power vs. Lithia Motors | U Power vs. AutoNation | U Power vs. Penske Automotive Group |
| Gyre Therapeutics vs. Meiwu Technology Co | Gyre Therapeutics vs. U Power Limited | Gyre Therapeutics vs. Lucid Group | Gyre Therapeutics vs. Wabash National |
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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