Correlation Between United Rentals and Carnival Plc
Can any of the company-specific risk be diversified away by investing in both United Rentals and Carnival Plc 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 United Rentals and Carnival Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Rentals and Carnival plc, you can compare the effects of market volatilities on United Rentals and Carnival Plc 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 United Rentals with a short position of Carnival Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Carnival Plc.
Diversification Opportunities for United Rentals and Carnival Plc
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between United and Carnival is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Carnival plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carnival plc and United Rentals 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 United Rentals are associated (or correlated) with Carnival Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carnival plc has no effect on the direction of United Rentals i.e., United Rentals and Carnival Plc go up and down completely randomly.
Pair Corralation between United Rentals and Carnival Plc
Assuming the 90 days trading horizon United Rentals is expected to generate 4.47 times less return on investment than Carnival Plc. In addition to that, United Rentals is 1.17 times more volatile than Carnival plc. It trades about 0.04 of its total potential returns per unit of risk. Carnival plc is currently generating about 0.2 per unit of volatility. If you would invest 15,456 in Carnival plc on November 4, 2024 and sell it today you would earn a total of 1,239 from holding Carnival plc or generate 8.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
United Rentals vs. Carnival plc
Performance |
| Timeline |
| United Rentals |
| Carnival plc |
United Rentals and Carnival Plc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Rentals and Carnival Plc
The main advantage of trading using opposite United Rentals and Carnival Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals position performs unexpectedly, Carnival Plc 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 Carnival Plc will offset losses from the drop in Carnival Plc's long position.| United Rentals vs. Seagate Technology Holdings | United Rentals vs. Clover Health Investments, | United Rentals vs. TechnipFMC plc | United Rentals vs. Liberty Broadband |
| Carnival Plc vs. Broadridge Financial Solutions, | Carnival Plc vs. T Mobile | Carnival Plc vs. Burlington Stores, | Carnival Plc vs. Jefferies Financial 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |