Correlation Between U Haul and Brunswick
Can any of the company-specific risk be diversified away by investing in both U Haul and Brunswick 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 U Haul and Brunswick into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between U Haul Holding and Brunswick, you can compare the effects of market volatilities on U Haul and Brunswick 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 U Haul with a short position of Brunswick. Check out your portfolio center. Please also check ongoing floating volatility patterns of U Haul and Brunswick.
Diversification Opportunities for U Haul and Brunswick
Weak diversification
The 3 months correlation between UHAL-B and Brunswick is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding U Haul Holding and Brunswick in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brunswick and U Haul 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 U Haul Holding are associated (or correlated) with Brunswick. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brunswick has no effect on the direction of U Haul i.e., U Haul and Brunswick go up and down completely randomly.
Pair Corralation between U Haul and Brunswick
Assuming the 90 days trading horizon U Haul Holding is expected to generate 0.74 times more return on investment than Brunswick. However, U Haul Holding is 1.35 times less risky than Brunswick. It trades about 0.17 of its potential returns per unit of risk. Brunswick is currently generating about -0.13 per unit of risk. If you would invest 6,425 in U Haul Holding on September 13, 2024 and sell it today you would earn a total of 330.00 from holding U Haul Holding or generate 5.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
U Haul Holding vs. Brunswick
Performance |
| Timeline |
| U Haul Holding |
| Brunswick |
U Haul and Brunswick Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with U Haul and Brunswick
The main advantage of trading using opposite U Haul and Brunswick positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if U Haul position performs unexpectedly, Brunswick 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 Brunswick will offset losses from the drop in Brunswick's long position.The idea behind U Haul Holding and Brunswick pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Brunswick vs. Clarus Corp | Brunswick vs. Escalade Incorporated | Brunswick vs. Johnson Outdoors | Brunswick vs. JAKKS Pacific |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |