Correlation Between Mobilezone Holding and United Rentals
Can any of the company-specific risk be diversified away by investing in both Mobilezone Holding 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 Mobilezone Holding and United Rentals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mobilezone Holding AG and United Rentals, you can compare the effects of market volatilities on Mobilezone Holding 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 Mobilezone Holding with a short position of United Rentals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mobilezone Holding and United Rentals.
Diversification Opportunities for Mobilezone Holding and United Rentals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Mobilezone and United is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mobilezone Holding AG and United Rentals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Rentals and Mobilezone Holding 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 Mobilezone Holding AG 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 Mobilezone Holding i.e., Mobilezone Holding and United Rentals go up and down completely randomly.
Pair Corralation between Mobilezone Holding and United Rentals
Assuming the 90 days trading horizon Mobilezone Holding is expected to generate 2.94 times less return on investment than United Rentals. But when comparing it to its historical volatility, Mobilezone Holding AG is 3.47 times less risky than United Rentals. It trades about 0.06 of its potential returns per unit of risk. United Rentals is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 42,571 in United Rentals on November 7, 2024 and sell it today you would earn a total of 28,469 from holding United Rentals or generate 66.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mobilezone Holding AG vs. United Rentals
Performance |
| Timeline |
| Mobilezone Holding |
| United Rentals |
Mobilezone Holding and United Rentals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mobilezone Holding and United Rentals
The main advantage of trading using opposite Mobilezone Holding and United Rentals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mobilezone Holding 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.| Mobilezone Holding vs. BRIT AMER TOBACCO | Mobilezone Holding vs. DATANG INTL POW | Mobilezone Holding vs. TRADEGATE | Mobilezone Holding vs. CarsalesCom |
| United Rentals vs. SEI INVESTMENTS | United Rentals vs. Guangdong Investment Limited | United Rentals vs. PennantPark Investment | United Rentals vs. Cognizant Technology Solutions |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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