Correlation Between American Leisure and UHF Logistics
Can any of the company-specific risk be diversified away by investing in both American Leisure and UHF Logistics 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 American Leisure and UHF Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Leisure Holdings and UHF Logistics Group, you can compare the effects of market volatilities on American Leisure and UHF Logistics 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 American Leisure with a short position of UHF Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Leisure and UHF Logistics.
Diversification Opportunities for American Leisure and UHF Logistics
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between American and UHF is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding American Leisure Holdings and UHF Logistics Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UHF Logistics Group and American Leisure 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 American Leisure Holdings are associated (or correlated) with UHF Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UHF Logistics Group has no effect on the direction of American Leisure i.e., American Leisure and UHF Logistics go up and down completely randomly.
Pair Corralation between American Leisure and UHF Logistics
Given the investment horizon of 90 days American Leisure Holdings is expected to generate 1.46 times more return on investment than UHF Logistics. However, American Leisure is 1.46 times more volatile than UHF Logistics Group. It trades about 0.17 of its potential returns per unit of risk. UHF Logistics Group is currently generating about 0.09 per unit of risk. If you would invest 0.01 in American Leisure Holdings on September 3, 2024 and sell it today you would earn a total of 0.00 from holding American Leisure Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
American Leisure Holdings vs. UHF Logistics Group
Performance |
| Timeline |
| American Leisure Holdings |
| UHF Logistics Group |
American Leisure and UHF Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Leisure and UHF Logistics
The main advantage of trading using opposite American Leisure and UHF Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Leisure position performs unexpectedly, UHF Logistics 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 UHF Logistics will offset losses from the drop in UHF Logistics' long position.| American Leisure vs. Manaris Corp | American Leisure vs. Alpha One | American Leisure vs. Green Planet Bio | American Leisure vs. Continental Beverage Brands |
| UHF Logistics vs. Manaris Corp | UHF Logistics vs. Alpha One | UHF Logistics vs. Green Planet Bio | UHF Logistics vs. Continental Beverage Brands |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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