Correlation Between Universal Logistics and Lithium One
Can any of the company-specific risk be diversified away by investing in both Universal Logistics and Lithium One 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 Universal Logistics and Lithium One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Universal Logistics Holdings and Lithium One Metals, you can compare the effects of market volatilities on Universal Logistics and Lithium One 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 Universal Logistics with a short position of Lithium One. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Logistics and Lithium One.
Diversification Opportunities for Universal Logistics and Lithium One
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Universal and Lithium is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Universal Logistics Holdings and Lithium One Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lithium One Metals and Universal 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 Universal Logistics Holdings are associated (or correlated) with Lithium One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lithium One Metals has no effect on the direction of Universal Logistics i.e., Universal Logistics and Lithium One go up and down completely randomly.
Pair Corralation between Universal Logistics and Lithium One
Considering the 90-day investment horizon Universal Logistics Holdings is expected to generate 0.3 times more return on investment than Lithium One. However, Universal Logistics Holdings is 3.34 times less risky than Lithium One. It trades about 0.28 of its potential returns per unit of risk. Lithium One Metals is currently generating about -0.07 per unit of risk. If you would invest 4,269 in Universal Logistics Holdings on September 2, 2024 and sell it today you would earn a total of 942.00 from holding Universal Logistics Holdings or generate 22.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Universal Logistics Holdings vs. Lithium One Metals
Performance |
| Timeline |
| Universal Logistics |
| Lithium One Metals |
Universal Logistics and Lithium One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Universal Logistics and Lithium One
The main advantage of trading using opposite Universal Logistics and Lithium One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Universal Logistics position performs unexpectedly, Lithium One 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 Lithium One will offset losses from the drop in Lithium One's long position.| Universal Logistics vs. Covenant Logistics Group, | Universal Logistics vs. Marten Transport | Universal Logistics vs. Midland States Bancorp | Universal Logistics vs. PC Connection |
| Lithium One vs. SunLink Health Systems | Lithium One vs. Capital Clean Energy | Lithium One vs. National Vision Holdings | Lithium One vs. SkyWest |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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