Correlation Between U Power and Mader Group
Can any of the company-specific risk be diversified away by investing in both U Power and Mader Group 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 Mader Group 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 Mader Group Limited, you can compare the effects of market volatilities on U Power and Mader Group 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 Mader Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of U Power and Mader Group.
Diversification Opportunities for U Power and Mader Group
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between UCAR and Mader is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding U Power Limited and Mader Group Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mader Group Limited 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 Mader Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mader Group Limited has no effect on the direction of U Power i.e., U Power and Mader Group go up and down completely randomly.
Pair Corralation between U Power and Mader Group
Given the investment horizon of 90 days U Power Limited is expected to under-perform the Mader Group. In addition to that, U Power is 4.39 times more volatile than Mader Group Limited. It trades about -0.36 of its total potential returns per unit of risk. Mader Group Limited is currently generating about 0.22 per unit of volatility. If you would invest 357.00 in Mader Group Limited on November 3, 2024 and sell it today you would earn a total of 43.00 from holding Mader Group Limited or generate 12.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
U Power Limited vs. Mader Group Limited
Performance |
| Timeline |
| U Power Limited |
| Mader Group Limited |
U Power and Mader Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with U Power and Mader Group
The main advantage of trading using opposite U Power and Mader Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if U Power position performs unexpectedly, Mader Group 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 Mader Group will offset losses from the drop in Mader Group's long position.| U Power vs. Kaixin Auto Holdings | U Power vs. Uxin | U Power vs. SunCar Technology Group | U Power vs. Carvana Co |
| Mader Group vs. Skillful Craftsman Education | Mader Group vs. Catalyst Metals Limited | Mader Group vs. Yuexiu Transport Infrastructure | Mader Group vs. Electrovaya Common Shares |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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