Correlation Between UHF Logistics and Xtra Energy
Can any of the company-specific risk be diversified away by investing in both UHF Logistics and Xtra Energy 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 UHF Logistics and Xtra Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between UHF Logistics Group and Xtra Energy Corp, you can compare the effects of market volatilities on UHF Logistics and Xtra Energy 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 UHF Logistics with a short position of Xtra Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of UHF Logistics and Xtra Energy.
Diversification Opportunities for UHF Logistics and Xtra Energy
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between UHF and Xtra is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding UHF Logistics Group and Xtra Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xtra Energy Corp and UHF Logistics 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 UHF Logistics Group are associated (or correlated) with Xtra Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xtra Energy Corp has no effect on the direction of UHF Logistics i.e., UHF Logistics and Xtra Energy go up and down completely randomly.
Pair Corralation between UHF Logistics and Xtra Energy
Given the investment horizon of 90 days UHF Logistics Group is expected to generate 5.9 times more return on investment than Xtra Energy. However, UHF Logistics is 5.9 times more volatile than Xtra Energy Corp. It trades about 0.11 of its potential returns per unit of risk. Xtra Energy Corp is currently generating about 0.25 per unit of risk. If you would invest 4.50 in UHF Logistics Group on August 30, 2024 and sell it today you would lose (1.30) from holding UHF Logistics Group or give up 28.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
UHF Logistics Group vs. Xtra Energy Corp
Performance |
| Timeline |
| UHF Logistics Group |
| Xtra Energy Corp |
UHF Logistics and Xtra Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UHF Logistics and Xtra Energy
The main advantage of trading using opposite UHF Logistics and Xtra Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UHF Logistics position performs unexpectedly, Xtra Energy 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 Xtra Energy will offset losses from the drop in Xtra Energy's long position.| UHF Logistics vs. New Generation Consumer | UHF Logistics vs. Xtra Energy Corp | UHF Logistics vs. Arsenal Digital Holdings | UHF Logistics vs. Golden Star Acquisition |
| Xtra Energy vs. XCana Petroleum | Xtra Energy vs. New Generation Consumer | Xtra Energy vs. Arsenal Digital Holdings | Xtra Energy vs. UHF Logistics 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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