Correlation Between Ucommune International and Leju Holdings

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

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

Diversification Opportunities for Ucommune International and Leju Holdings

0.07

Correlation Coefficient

Ucommune International  Leju Holdings

Significant diversification

The 3 months correlation between Ucommune and Leju is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Ucommune International and Leju Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leju Holdings Limited 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 Leju Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leju Holdings Limited has no effect on the direction of Ucommune International i.e., Ucommune International and Leju Holdings go up and down completely randomly.

Pair Corralation between Ucommune International and Leju Holdings

If you would invest  207.00  in Leju Holdings Limited on September 5, 2024 and sell it today you would earn a total of  0.00  from holding Leju Holdings Limited or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	2.38%
Values	Daily Returns

Ucommune International  vs.  Leju Holdings Limited

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 latest inconsistent performance, the Etf's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the ETF venture institutional investors.

Leju Holdings Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Leju Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking indicators, Leju Holdings is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Ucommune International and Leju Holdings

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

The idea behind Ucommune International and Leju Holdings Limited 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.