Correlation Between Ucommune International and Brandywine Realty

Can any of the company-specific risk be diversified away by investing in both Ucommune International and Brandywine Realty 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 Brandywine Realty into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ucommune International and Brandywine Realty Trust, you can compare the effects of market volatilities on Ucommune International and Brandywine Realty 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 Brandywine Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ucommune International and Brandywine Realty.

Diversification Opportunities for Ucommune International and Brandywine Realty

-0.38

Correlation Coefficient

Ucommune International  Brandywine Realty

Very good diversification

The 3 months correlation between Ucommune and Brandywine is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Ucommune International and Brandywine Realty Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brandywine Realty Trust 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 Brandywine Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brandywine Realty Trust has no effect on the direction of Ucommune International i.e., Ucommune International and Brandywine Realty go up and down completely randomly.

Pair Corralation between Ucommune International and Brandywine Realty

Allowing for the 90-day total investment horizon Ucommune International is expected to under-perform the Brandywine Realty. In addition to that, Ucommune International is 1.72 times more volatile than Brandywine Realty Trust. It trades about 0.0 of its total potential returns per unit of risk. Brandywine Realty Trust is currently generating about 0.09 per unit of volatility. If you would invest  509.00  in Brandywine Realty Trust on August 30, 2024 and sell it today you would earn a total of  68.00  from holding Brandywine Realty Trust or generate 13.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Ucommune International  vs.  Brandywine Realty Trust

Ucommune International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ucommune International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Ucommune International is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Brandywine Realty Trust

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Brandywine Realty Trust are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent fundamental indicators, Brandywine Realty displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ucommune International and Brandywine Realty

The main advantage of trading using opposite Ucommune International and Brandywine Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ucommune International position performs unexpectedly, Brandywine Realty 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 Brandywine Realty will offset losses from the drop in Brandywine Realty's long position.

The idea behind Ucommune International and Brandywine Realty Trust 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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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.