Correlation Between U Power and 30321L2E1

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Can any of the company-specific risk be diversified away by investing in both U Power and 30321L2E1 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 30321L2E1 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 FG 515 07 JUL 25, you can compare the effects of market volatilities on U Power and 30321L2E1 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 30321L2E1. Check out your portfolio center. Please also check ongoing floating volatility patterns of U Power and 30321L2E1.

Diversification Opportunities for U Power and 30321L2E1

0.19
  Correlation Coefficient

Average diversification

The 3 months correlation between UCAR and 30321L2E1 is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding U Power Limited and FG 515 07 JUL 25 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FG 515 07 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 30321L2E1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FG 515 07 has no effect on the direction of U Power i.e., U Power and 30321L2E1 go up and down completely randomly.

Pair Corralation between U Power and 30321L2E1

Given the investment horizon of 90 days U Power Limited is expected to generate 4.32 times more return on investment than 30321L2E1. However, U Power is 4.32 times more volatile than FG 515 07 JUL 25. It trades about 0.08 of its potential returns per unit of risk. FG 515 07 JUL 25 is currently generating about -0.4 per unit of risk. If you would invest  675.00  in U Power Limited on September 13, 2024 and sell it today you would earn a total of  35.00  from holding U Power Limited or generate 5.19% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy27.27%
ValuesDaily Returns

U Power Limited  vs.  FG 515 07 JUL 25

 Performance 
       Timeline  
U Power Limited 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in U Power Limited are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, U Power reported solid returns over the last few months and may actually be approaching a breakup point.
FG 515 07 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days FG 515 07 JUL 25 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 30321L2E1 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

U Power and 30321L2E1 Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with U Power and 30321L2E1

The main advantage of trading using opposite U Power and 30321L2E1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if U Power position performs unexpectedly, 30321L2E1 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 30321L2E1 will offset losses from the drop in 30321L2E1's long position.
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The idea behind U Power Limited and FG 515 07 JUL 25 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.

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