Correlation Between CH Robinson and United Parcel
Can any of the company-specific risk be diversified away by investing in both CH Robinson and United Parcel 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 CH Robinson and United Parcel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CH Robinson Worldwide and United Parcel Service, you can compare the effects of market volatilities on CH Robinson and United Parcel 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 CH Robinson with a short position of United Parcel. Check out your portfolio center. Please also check ongoing floating volatility patterns of CH Robinson and United Parcel.
Diversification Opportunities for CH Robinson and United Parcel
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between CH1A and United is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding CH Robinson Worldwide and United Parcel Service in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Parcel Service and CH Robinson 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 CH Robinson Worldwide are associated (or correlated) with United Parcel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Parcel Service has no effect on the direction of CH Robinson i.e., CH Robinson and United Parcel go up and down completely randomly.
Pair Corralation between CH Robinson and United Parcel
Assuming the 90 days trading horizon CH Robinson is expected to generate 1.9 times less return on investment than United Parcel. In addition to that, CH Robinson is 1.44 times more volatile than United Parcel Service. It trades about 0.04 of its total potential returns per unit of risk. United Parcel Service is currently generating about 0.12 per unit of volatility. If you would invest 12,416 in United Parcel Service on August 30, 2024 and sell it today you would earn a total of 430.00 from holding United Parcel Service or generate 3.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CH Robinson Worldwide vs. United Parcel Service
Performance |
| Timeline |
| CH Robinson Worldwide |
| United Parcel Service |
CH Robinson and United Parcel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CH Robinson and United Parcel
The main advantage of trading using opposite CH Robinson and United Parcel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CH Robinson position performs unexpectedly, United Parcel 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 United Parcel will offset losses from the drop in United Parcel's long position.| CH Robinson vs. ZTO Express | CH Robinson vs. Expeditors International of | CH Robinson vs. Superior Plus Corp | CH Robinson vs. Origin Agritech |
| United Parcel vs. Transportadora de Gas | United Parcel vs. Air Transport Services | United Parcel vs. Broadcom | United Parcel vs. Lamar Advertising |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |