Correlation Between UNITED URBAN and Air Products
Can any of the company-specific risk be diversified away by investing in both UNITED URBAN and Air Products 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 UNITED URBAN and Air Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UNITED URBAN INV and Air Products and, you can compare the effects of market volatilities on UNITED URBAN and Air Products 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 UNITED URBAN with a short position of Air Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNITED URBAN and Air Products.
Diversification Opportunities for UNITED URBAN and Air Products
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between UNITED and Air is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding UNITED URBAN INV and Air Products and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Products and UNITED URBAN 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 UNITED URBAN INV are associated (or correlated) with Air Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Products has no effect on the direction of UNITED URBAN i.e., UNITED URBAN and Air Products go up and down completely randomly.
Pair Corralation between UNITED URBAN and Air Products
Assuming the 90 days horizon UNITED URBAN INV is expected to under-perform the Air Products. But the stock apears to be less risky and, when comparing its historical volatility, UNITED URBAN INV is 1.66 times less risky than Air Products. The stock trades about -0.01 of its potential returns per unit of risk. The Air Products and is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 26,242 in Air Products and on August 28, 2024 and sell it today you would earn a total of 5,428 from holding Air Products and or generate 20.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
UNITED URBAN INV vs. Air Products and
Performance |
| Timeline |
| UNITED URBAN INV |
| Air Products |
UNITED URBAN and Air Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UNITED URBAN and Air Products
The main advantage of trading using opposite UNITED URBAN and Air Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UNITED URBAN position performs unexpectedly, Air Products 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 Air Products will offset losses from the drop in Air Products' long position.| UNITED URBAN vs. Apple Inc | UNITED URBAN vs. Apple Inc | UNITED URBAN vs. Apple Inc | UNITED URBAN vs. Apple Inc |
| Air Products vs. Major Drilling Group | Air Products vs. CECO ENVIRONMENTAL | Air Products vs. Perma Fix Environmental Services | Air Products vs. CosmoSteel Holdings Limited |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |