Correlation Between Ucommune International and IRSA Inversiones

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

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

Diversification Opportunities for Ucommune International and IRSA Inversiones

-0.61

Correlation Coefficient

Ucommune International  IRSA Inversiones

Excellent diversification

The 3 months correlation between Ucommune and IRSA is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ucommune International and IRSA Inversiones Y in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IRSA Inversiones Y 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 IRSA Inversiones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IRSA Inversiones Y has no effect on the direction of Ucommune International i.e., Ucommune International and IRSA Inversiones go up and down completely randomly.

Pair Corralation between Ucommune International and IRSA Inversiones

Allowing for the 90-day total investment horizon Ucommune International is expected to under-perform the IRSA Inversiones. But the etf apears to be less risky and, when comparing its historical volatility, Ucommune International is 1.09 times less risky than IRSA Inversiones. The etf trades about -0.08 of its potential returns per unit of risk. The IRSA Inversiones Y is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest  1,025  in IRSA Inversiones Y on February 7, 2024 and sell it today you would lose (41.00) from holding IRSA Inversiones Y or give up 4.0% of portfolio value over 90 days.

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

Ucommune International  vs.  IRSA Inversiones Y

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.

IRSA Inversiones Y

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in IRSA Inversiones Y are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, IRSA Inversiones unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ucommune International and IRSA Inversiones

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

The idea behind Ucommune International and IRSA Inversiones Y 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.

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 Bonds Directory module to find actively traded corporate debentures issued by US companies.