Correlation Between United Rentals and Alpha HPA
Can any of the company-specific risk be diversified away by investing in both United Rentals and Alpha HPA 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 Alpha HPA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Rentals and Alpha HPA, you can compare the effects of market volatilities on United Rentals and Alpha HPA 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 Alpha HPA. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Alpha HPA.
Diversification Opportunities for United Rentals and Alpha HPA
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between United and Alpha is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Alpha HPA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpha HPA 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 Alpha HPA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpha HPA has no effect on the direction of United Rentals i.e., United Rentals and Alpha HPA go up and down completely randomly.
Pair Corralation between United Rentals and Alpha HPA
Considering the 90-day investment horizon United Rentals is expected to generate 1.16 times more return on investment than Alpha HPA. However, United Rentals is 1.16 times more volatile than Alpha HPA. It trades about 0.1 of its potential returns per unit of risk. Alpha HPA is currently generating about 0.05 per unit of risk. If you would invest 71,129 in United Rentals on September 12, 2024 and sell it today you would earn a total of 8,473 from holding United Rentals or generate 11.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 96.92% |
| Values | Daily Returns |
United Rentals vs. Alpha HPA
Performance |
| Timeline |
| United Rentals |
| Alpha HPA |
United Rentals and Alpha HPA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Rentals and Alpha HPA
The main advantage of trading using opposite United Rentals and Alpha HPA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals position performs unexpectedly, Alpha HPA 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 Alpha HPA will offset losses from the drop in Alpha HPA's long position.| United Rentals vs. HE Equipment Services | United Rentals vs. GATX Corporation | United Rentals vs. McGrath RentCorp | United Rentals vs. Alta Equipment Group |
| Alpha HPA vs. Australian Unity Office | Alpha HPA vs. Mount Gibson Iron | Alpha HPA vs. Dalaroo Metals | Alpha HPA vs. GreenX Metals |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |