Correlation Between United Rentals and Orinda Income
Can any of the company-specific risk be diversified away by investing in both United Rentals and Orinda Income 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 Orinda Income into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Rentals and Orinda Income Opportunities, you can compare the effects of market volatilities on United Rentals and Orinda Income 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 Orinda Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Orinda Income.
Diversification Opportunities for United Rentals and Orinda Income
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between United and Orinda is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Orinda Income Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orinda Income Opport 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 Orinda Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orinda Income Opport has no effect on the direction of United Rentals i.e., United Rentals and Orinda Income go up and down completely randomly.
Pair Corralation between United Rentals and Orinda Income
Considering the 90-day investment horizon United Rentals is expected to generate 3.81 times more return on investment than Orinda Income. However, United Rentals is 3.81 times more volatile than Orinda Income Opportunities. It trades about 0.11 of its potential returns per unit of risk. Orinda Income Opportunities is currently generating about 0.14 per unit of risk. If you would invest 44,333 in United Rentals on September 4, 2024 and sell it today you would earn a total of 41,372 from holding United Rentals or generate 93.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Rentals vs. Orinda Income Opportunities
Performance |
| Timeline |
| United Rentals |
| Orinda Income Opport |
United Rentals and Orinda Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Rentals and Orinda Income
The main advantage of trading using opposite United Rentals and Orinda Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals position performs unexpectedly, Orinda Income 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 Orinda Income will offset losses from the drop in Orinda Income'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 |
| Orinda Income vs. Orinda Income Opportunities | Orinda Income vs. Orinda Income Opportunities | Orinda Income vs. Vanguard High Yield Corporate | Orinda Income vs. Janus Forty Fund |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |