Correlation Between Birkenstock Holding and Uber Technologies
Can any of the company-specific risk be diversified away by investing in both Birkenstock Holding and Uber Technologies 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 Birkenstock Holding and Uber Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Birkenstock Holding plc and Uber Technologies, you can compare the effects of market volatilities on Birkenstock Holding and Uber Technologies 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 Birkenstock Holding with a short position of Uber Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Birkenstock Holding and Uber Technologies.
Diversification Opportunities for Birkenstock Holding and Uber Technologies
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Birkenstock and Uber is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Birkenstock Holding plc and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies and Birkenstock Holding 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 Birkenstock Holding plc are associated (or correlated) with Uber Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uber Technologies has no effect on the direction of Birkenstock Holding i.e., Birkenstock Holding and Uber Technologies go up and down completely randomly.
Pair Corralation between Birkenstock Holding and Uber Technologies
Given the investment horizon of 90 days Birkenstock Holding is expected to generate 7.04 times less return on investment than Uber Technologies. In addition to that, Birkenstock Holding is 1.05 times more volatile than Uber Technologies. It trades about 0.01 of its total potential returns per unit of risk. Uber Technologies is currently generating about 0.08 per unit of volatility. If you would invest 2,901 in Uber Technologies on December 12, 2024 and sell it today you would earn a total of 3,648 from holding Uber Technologies or generate 125.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 71.0% |
| Values | Daily Returns |
Birkenstock Holding plc vs. Uber Technologies
Performance |
| Timeline |
| Birkenstock Holding plc |
| Uber Technologies |
Birkenstock Holding and Uber Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Birkenstock Holding and Uber Technologies
The main advantage of trading using opposite Birkenstock Holding and Uber Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Birkenstock Holding position performs unexpectedly, Uber Technologies 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 Uber Technologies will offset losses from the drop in Uber Technologies' long position.| Birkenstock Holding vs. Take Two Interactive Software | ||
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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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