Correlation Between Avis Budget and U Haul
Can any of the company-specific risk be diversified away by investing in both Avis Budget and U Haul 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 Avis Budget and U Haul into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Avis Budget Group and U Haul Holding, you can compare the effects of market volatilities on Avis Budget and U Haul 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 Avis Budget with a short position of U Haul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Avis Budget and U Haul.
Diversification Opportunities for Avis Budget and U Haul
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Avis and UHAL is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Avis Budget Group and U Haul Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Haul Holding and Avis Budget 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 Avis Budget Group are associated (or correlated) with U Haul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Haul Holding has no effect on the direction of Avis Budget i.e., Avis Budget and U Haul go up and down completely randomly.
Pair Corralation between Avis Budget and U Haul
Considering the 90-day investment horizon Avis Budget is expected to generate 2.47 times less return on investment than U Haul. In addition to that, Avis Budget is 2.23 times more volatile than U Haul Holding. It trades about 0.01 of its total potential returns per unit of risk. U Haul Holding is currently generating about 0.05 per unit of volatility. If you would invest 6,421 in U Haul Holding on September 1, 2024 and sell it today you would earn a total of 646.00 from holding U Haul Holding or generate 10.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Avis Budget Group vs. U Haul Holding
Performance |
| Timeline |
| Avis Budget Group |
| U Haul Holding |
Avis Budget and U Haul Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Avis Budget and U Haul
The main advantage of trading using opposite Avis Budget and U Haul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Avis Budget position performs unexpectedly, U Haul 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 U Haul will offset losses from the drop in U Haul's long position.| Avis Budget vs. Hertz Global Hldgs | Avis Budget vs. Ryder System | Avis Budget vs. HE Equipment Services | Avis Budget vs. United Rentals |
| U Haul vs. Air Lease | U Haul vs. HE Equipment Services | U Haul vs. GATX Corporation | U Haul vs. Custom Truck One |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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