Correlation Between Expeditors International and CH Robinson
Can any of the company-specific risk be diversified away by investing in both Expeditors International and CH Robinson 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 Expeditors International and CH Robinson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Expeditors International of and CH Robinson Worldwide, you can compare the effects of market volatilities on Expeditors International and CH Robinson 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 Expeditors International with a short position of CH Robinson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expeditors International and CH Robinson.
Diversification Opportunities for Expeditors International and CH Robinson
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Expeditors and CHRW is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Expeditors International of and CH Robinson Worldwide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CH Robinson Worldwide and Expeditors International 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 Expeditors International of are associated (or correlated) with CH Robinson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CH Robinson Worldwide has no effect on the direction of Expeditors International i.e., Expeditors International and CH Robinson go up and down completely randomly.
Pair Corralation between Expeditors International and CH Robinson
Given the investment horizon of 90 days Expeditors International is expected to generate 12.53 times less return on investment than CH Robinson. But when comparing it to its historical volatility, Expeditors International of is 1.65 times less risky than CH Robinson. It trades about 0.01 of its potential returns per unit of risk. CH Robinson Worldwide is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 7,312 in CH Robinson Worldwide on August 27, 2024 and sell it today you would earn a total of 3,449 from holding CH Robinson Worldwide or generate 47.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Expeditors International of vs. CH Robinson Worldwide
Performance |
| Timeline |
| Expeditors International |
| CH Robinson Worldwide |
Expeditors International and CH Robinson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Expeditors International and CH Robinson
The main advantage of trading using opposite Expeditors International and CH Robinson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Expeditors International position performs unexpectedly, CH Robinson 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 CH Robinson will offset losses from the drop in CH Robinson's long position.| Expeditors International vs. Landstar System | Expeditors International vs. JB Hunt Transport | Expeditors International vs. Hub Group | Expeditors International vs. Forward Air |
| CH Robinson vs. JB Hunt Transport | CH Robinson vs. Landstar System | CH Robinson vs. Hub Group | CH Robinson vs. Forward Air |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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