Correlation Between Xunlei and Universal Technical
Can any of the company-specific risk be diversified away by investing in both Xunlei and Universal Technical 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 Xunlei and Universal Technical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xunlei Ltd Adr and Universal Technical Institute, you can compare the effects of market volatilities on Xunlei and Universal Technical 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 Xunlei with a short position of Universal Technical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xunlei and Universal Technical.
Diversification Opportunities for Xunlei and Universal Technical
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Xunlei and Universal is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Xunlei Ltd Adr and Universal Technical Institute in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Technical and Xunlei 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 Xunlei Ltd Adr are associated (or correlated) with Universal Technical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Technical has no effect on the direction of Xunlei i.e., Xunlei and Universal Technical go up and down completely randomly.
Pair Corralation between Xunlei and Universal Technical
Given the investment horizon of 90 days Xunlei is expected to generate 2.45 times less return on investment than Universal Technical. In addition to that, Xunlei is 1.23 times more volatile than Universal Technical Institute. It trades about 0.04 of its total potential returns per unit of risk. Universal Technical Institute is currently generating about 0.11 per unit of volatility. If you would invest 760.00 in Universal Technical Institute on November 2, 2024 and sell it today you would earn a total of 2,006 from holding Universal Technical Institute or generate 264.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Xunlei Ltd Adr vs. Universal Technical Institute
Performance |
| Timeline |
| Xunlei Ltd Adr |
| Universal Technical |
Xunlei and Universal Technical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xunlei and Universal Technical
The main advantage of trading using opposite Xunlei and Universal Technical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xunlei position performs unexpectedly, Universal Technical 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 Universal Technical will offset losses from the drop in Universal Technical's long position.| Xunlei vs. Travelzoo | Xunlei vs. Emerald Expositions Events | Xunlei vs. Ziff Davis | Xunlei vs. Direct Digital Holdings |
| Universal Technical vs. Wah Fu Education | Universal Technical vs. Sunlands Technology Group | Universal Technical vs. 51Talk Online Education | Universal Technical vs. China Liberal Education |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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