Correlation Between KENEDIX OFFICE and United Rentals
Can any of the company-specific risk be diversified away by investing in both KENEDIX OFFICE and United Rentals 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 KENEDIX OFFICE and United Rentals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KENEDIX OFFICE INV and United Rentals, you can compare the effects of market volatilities on KENEDIX OFFICE and United Rentals 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 KENEDIX OFFICE with a short position of United Rentals. Check out your portfolio center. Please also check ongoing floating volatility patterns of KENEDIX OFFICE and United Rentals.
Diversification Opportunities for KENEDIX OFFICE and United Rentals
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between KENEDIX and United is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding KENEDIX OFFICE INV and United Rentals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Rentals and KENEDIX OFFICE 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 KENEDIX OFFICE INV are associated (or correlated) with United Rentals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Rentals has no effect on the direction of KENEDIX OFFICE i.e., KENEDIX OFFICE and United Rentals go up and down completely randomly.
Pair Corralation between KENEDIX OFFICE and United Rentals
Assuming the 90 days horizon KENEDIX OFFICE is expected to generate 1.72 times less return on investment than United Rentals. But when comparing it to its historical volatility, KENEDIX OFFICE INV is 2.22 times less risky than United Rentals. It trades about 0.18 of its potential returns per unit of risk. United Rentals is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 74,172 in United Rentals on September 1, 2024 and sell it today you would earn a total of 7,728 from holding United Rentals or generate 10.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KENEDIX OFFICE INV vs. United Rentals
Performance |
| Timeline |
| KENEDIX OFFICE INV |
| United Rentals |
KENEDIX OFFICE and United Rentals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KENEDIX OFFICE and United Rentals
The main advantage of trading using opposite KENEDIX OFFICE and United Rentals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KENEDIX OFFICE position performs unexpectedly, United Rentals 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 Rentals will offset losses from the drop in United Rentals' long position.| KENEDIX OFFICE vs. Apple Inc | KENEDIX OFFICE vs. Apple Inc | KENEDIX OFFICE vs. Apple Inc | KENEDIX OFFICE vs. Apple Inc |
| United Rentals vs. MAGNUM MINING EXP | United Rentals vs. Tencent Music Entertainment | United Rentals vs. SYSTEMAIR AB | United Rentals vs. ALTAIR RES INC |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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