Correlation Between ArcBest Corp and US Xpress
Can any of the company-specific risk be diversified away by investing in both ArcBest Corp and US Xpress 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 ArcBest Corp and US Xpress into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ArcBest Corp and US Xpress Enterprises, you can compare the effects of market volatilities on ArcBest Corp and US Xpress 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 ArcBest Corp with a short position of US Xpress. Check out your portfolio center. Please also check ongoing floating volatility patterns of ArcBest Corp and US Xpress.
Diversification Opportunities for ArcBest Corp and US Xpress
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ArcBest and USX is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding ArcBest Corp and US Xpress Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Xpress Enterprises and ArcBest Corp 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 ArcBest Corp are associated (or correlated) with US Xpress. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Xpress Enterprises has no effect on the direction of ArcBest Corp i.e., ArcBest Corp and US Xpress go up and down completely randomly.
Pair Corralation between ArcBest Corp and US Xpress
Given the investment horizon of 90 days ArcBest Corp is expected to generate 16.55 times less return on investment than US Xpress. But when comparing it to its historical volatility, ArcBest Corp is 8.79 times less risky than US Xpress. It trades about 0.04 of its potential returns per unit of risk. US Xpress Enterprises is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 209.00 in US Xpress Enterprises on September 2, 2024 and sell it today you would earn a total of 405.00 from holding US Xpress Enterprises or generate 193.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 28.02% |
| Values | Daily Returns |
ArcBest Corp vs. US Xpress Enterprises
Performance |
| Timeline |
| ArcBest Corp |
| US Xpress Enterprises |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ArcBest Corp and US Xpress Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ArcBest Corp and US Xpress
The main advantage of trading using opposite ArcBest Corp and US Xpress positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ArcBest Corp position performs unexpectedly, US Xpress 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 US Xpress will offset losses from the drop in US Xpress' long position.| ArcBest Corp vs. Universal Logistics Holdings | ArcBest Corp vs. Schneider National | ArcBest Corp vs. Marten Transport | ArcBest Corp vs. Covenant Logistics Group, |
| US Xpress vs. Heartland Express | US Xpress vs. Universal Logistics Holdings | US Xpress vs. Marten Transport | US Xpress vs. Werner Enterprises |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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