Correlation Between Ucommune International and FLEX LNG
Can any of the company-specific risk be diversified away by investing in both Ucommune International and FLEX LNG 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 Ucommune International and FLEX LNG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ucommune International and FLEX LNG, you can compare the effects of market volatilities on Ucommune International and FLEX LNG 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 Ucommune International with a short position of FLEX LNG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ucommune International and FLEX LNG.
Diversification Opportunities for Ucommune International and FLEX LNG
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ucommune and FLEX is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Ucommune International and FLEX LNG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FLEX LNG and Ucommune International 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 Ucommune International are associated (or correlated) with FLEX LNG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FLEX LNG has no effect on the direction of Ucommune International i.e., Ucommune International and FLEX LNG go up and down completely randomly.
Pair Corralation between Ucommune International and FLEX LNG
Assuming the 90 days horizon Ucommune International is expected to generate 4.95 times more return on investment than FLEX LNG. However, Ucommune International is 4.95 times more volatile than FLEX LNG. It trades about 0.08 of its potential returns per unit of risk. FLEX LNG is currently generating about -0.02 per unit of risk. If you would invest 0.93 in Ucommune International on August 30, 2024 and sell it today you would earn a total of 0.07 from holding Ucommune International or generate 7.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Ucommune International vs. FLEX LNG
Performance |
| Timeline |
| Ucommune International |
| FLEX LNG |
Ucommune International and FLEX LNG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ucommune International and FLEX LNG
The main advantage of trading using opposite Ucommune International and FLEX LNG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ucommune International position performs unexpectedly, FLEX LNG 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 FLEX LNG will offset losses from the drop in FLEX LNG's long position.| Ucommune International vs. Fabrinet | Ucommune International vs. Knowles Cor | Ucommune International vs. Ubiquiti Networks | Ucommune International vs. AmpliTech Group |
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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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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