Correlation Between United Rentals and Acroud AB
Can any of the company-specific risk be diversified away by investing in both United Rentals and Acroud AB 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 Acroud AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Rentals and Acroud AB, you can compare the effects of market volatilities on United Rentals and Acroud AB 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 Acroud AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Acroud AB.
Diversification Opportunities for United Rentals and Acroud AB
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between United and Acroud is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Acroud AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acroud AB 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 Acroud AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acroud AB has no effect on the direction of United Rentals i.e., United Rentals and Acroud AB go up and down completely randomly.
Pair Corralation between United Rentals and Acroud AB
Considering the 90-day investment horizon United Rentals is expected to generate 0.58 times more return on investment than Acroud AB. However, United Rentals is 1.74 times less risky than Acroud AB. It trades about 0.12 of its potential returns per unit of risk. Acroud AB is currently generating about -0.19 per unit of risk. If you would invest 78,769 in United Rentals on September 3, 2024 and sell it today you would earn a total of 7,831 from holding United Rentals or generate 9.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.67% |
| Values | Daily Returns |
United Rentals vs. Acroud AB
Performance |
| Timeline |
| United Rentals |
| Acroud AB |
United Rentals and Acroud AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Rentals and Acroud AB
The main advantage of trading using opposite United Rentals and Acroud AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals position performs unexpectedly, Acroud AB 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 Acroud AB will offset losses from the drop in Acroud AB's long position.| United Rentals vs. Alta Equipment Group | United Rentals vs. McGrath RentCorp | United Rentals vs. Herc Holdings | United Rentals vs. HE Equipment Services |
| Acroud AB vs. Kambi Group PLC | Acroud AB vs. Betsson AB | Acroud AB vs. Evolution AB | Acroud AB vs. Embracer Group AB |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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