Correlation Between Hertz Global and Multi Ways
Can any of the company-specific risk be diversified away by investing in both Hertz Global and Multi Ways 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 Hertz Global and Multi Ways into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hertz Global Hldgs and Multi Ways Holdings, you can compare the effects of market volatilities on Hertz Global and Multi Ways 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 Multi Ways. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hertz Global and Multi Ways.
Diversification Opportunities for Hertz Global and Multi Ways
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hertz and Multi is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Hertz Global Hldgs and Multi Ways Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Ways Holdings 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 Hldgs are associated (or correlated) with Multi Ways. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Ways Holdings has no effect on the direction of Hertz Global i.e., Hertz Global and Multi Ways go up and down completely randomly.
Pair Corralation between Hertz Global and Multi Ways
Assuming the 90 days horizon Hertz Global Hldgs is expected to generate 1.05 times more return on investment than Multi Ways. However, Hertz Global is 1.05 times more volatile than Multi Ways Holdings. It trades about 0.37 of its potential returns per unit of risk. Multi Ways Holdings is currently generating about -0.02 per unit of risk. If you would invest 184.00 in Hertz Global Hldgs on August 30, 2024 and sell it today you would earn a total of 76.00 from holding Hertz Global Hldgs or generate 41.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hertz Global Hldgs vs. Multi Ways Holdings
Performance |
| Timeline |
| Hertz Global Hldgs |
| Multi Ways Holdings |
Hertz Global and Multi Ways Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hertz Global and Multi Ways
The main advantage of trading using opposite Hertz Global and Multi Ways positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hertz Global position performs unexpectedly, Multi Ways 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 Multi Ways will offset losses from the drop in Multi Ways' long position.| Hertz Global vs. Hertz Global Holdings | Hertz Global vs. Avis Budget Group | Hertz Global vs. Herc Holdings | Hertz Global vs. Frontier Group Holdings |
| Multi Ways vs. FlexShopper | Multi Ways vs. Hertz Global Holdings | Multi Ways vs. HyreCar | Multi Ways vs. Avis Budget Group |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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