Correlation Between Uber Technologies and Estee Lauder
Can any of the company-specific risk be diversified away by investing in both Uber Technologies and Estee Lauder 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 Uber Technologies and Estee Lauder into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uber Technologies and Estee Lauder Companies, you can compare the effects of market volatilities on Uber Technologies and Estee Lauder 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 Uber Technologies with a short position of Estee Lauder. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uber Technologies and Estee Lauder.
Diversification Opportunities for Uber Technologies and Estee Lauder
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Uber and Estee is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies and Estee Lauder Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Estee Lauder Companies and Uber Technologies 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 Uber Technologies are associated (or correlated) with Estee Lauder. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Estee Lauder Companies has no effect on the direction of Uber Technologies i.e., Uber Technologies and Estee Lauder go up and down completely randomly.
Pair Corralation between Uber Technologies and Estee Lauder
Given the investment horizon of 90 days Uber Technologies is expected to generate 0.83 times more return on investment than Estee Lauder. However, Uber Technologies is 1.2 times less risky than Estee Lauder. It trades about 0.07 of its potential returns per unit of risk. Estee Lauder Companies is currently generating about -0.07 per unit of risk. If you would invest 4,174 in Uber Technologies on September 2, 2024 and sell it today you would earn a total of 3,022 from holding Uber Technologies or generate 72.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Uber Technologies vs. Estee Lauder Companies
Performance |
| Timeline |
| Uber Technologies |
| Estee Lauder Companies |
Uber Technologies and Estee Lauder Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Uber Technologies and Estee Lauder
The main advantage of trading using opposite Uber Technologies and Estee Lauder positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uber Technologies position performs unexpectedly, Estee Lauder 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 Estee Lauder will offset losses from the drop in Estee Lauder's long position.| Uber Technologies vs. Zoom Video Communications | Uber Technologies vs. Snowflake | Uber Technologies vs. Workday | Uber Technologies vs. C3 Ai Inc |
| Estee Lauder vs. Honest Company | Estee Lauder vs. Hims Hers Health | Estee Lauder vs. Procter Gamble | Estee Lauder vs. Coty 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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