Correlation Between Ucommune International and Modiv

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

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

Diversification Opportunities for Ucommune International and Modiv

-0.51

Correlation Coefficient

Ucommune International  Modiv

Excellent diversification

The 3 months correlation between Ucommune and Modiv is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Ucommune International and Modiv Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Modiv Inc 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 Modiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Modiv Inc has no effect on the direction of Ucommune International i.e., Ucommune International and Modiv go up and down completely randomly.

Pair Corralation between Ucommune International and Modiv

Allowing for the 90-day total investment horizon Ucommune International is expected to under-perform the Modiv. In addition to that, Ucommune International is 1.26 times more volatile than Modiv Inc. It trades about -0.06 of its total potential returns per unit of risk. Modiv Inc is currently generating about 0.09 per unit of volatility. If you would invest  1,459  in Modiv Inc on January 3, 2025 and sell it today you would earn a total of  159.00  from holding Modiv Inc or generate 10.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

Ucommune International  vs.  Modiv Inc

Ucommune International

Risk-Adjusted Performance

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 uncertain 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.

Modiv Inc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Modiv Inc are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile fundamental indicators, Modiv may actually be approaching a critical reversion point that can send shares even higher in May 2025.

Pair Trading with Ucommune International and Modiv

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

The idea behind Ucommune International and Modiv Inc 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.