Correlation Between Hertz Global and NSTAR
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By analyzing existing cross correlation between Hertz Global Holdings and NSTAR ELEC 32, you can compare the effects of market volatilities on Hertz Global and NSTAR 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 Hertz Global with a short position of NSTAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hertz Global and NSTAR.
Diversification Opportunities for Hertz Global and NSTAR
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hertz and NSTAR is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Hertz Global Holdings and NSTAR ELEC 32 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NSTAR ELEC 32 and Hertz Global 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 Hertz Global Holdings are associated (or correlated) with NSTAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NSTAR ELEC 32 has no effect on the direction of Hertz Global i.e., Hertz Global and NSTAR go up and down completely randomly.
Pair Corralation between Hertz Global and NSTAR
Considering the 90-day investment horizon Hertz Global Holdings is expected to generate 24.46 times more return on investment than NSTAR. However, Hertz Global is 24.46 times more volatile than NSTAR ELEC 32. It trades about 0.05 of its potential returns per unit of risk. NSTAR ELEC 32 is currently generating about 0.08 per unit of risk. If you would invest 413.00 in Hertz Global Holdings on September 1, 2024 and sell it today you would earn a total of 79.00 from holding Hertz Global Holdings or generate 19.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 88.89% |
| Values | Daily Returns |
Hertz Global Holdings vs. NSTAR ELEC 32
Performance |
| Timeline |
| Hertz Global Holdings |
| NSTAR ELEC 32 |
Hertz Global and NSTAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hertz Global and NSTAR
The main advantage of trading using opposite Hertz Global and NSTAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hertz Global position performs unexpectedly, NSTAR 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 NSTAR will offset losses from the drop in NSTAR's long position.| Hertz Global vs. United Rentals | Hertz Global vs. Ryder System | Hertz Global vs. Herc Holdings | Hertz Global vs. Hertz Global Hldgs |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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