Correlation Between United Rentals and Expat Romania
Can any of the company-specific risk be diversified away by investing in both United Rentals and Expat Romania 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 Expat Romania into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Rentals and Expat Romania BET, you can compare the effects of market volatilities on United Rentals and Expat Romania 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 Expat Romania. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Expat Romania.
Diversification Opportunities for United Rentals and Expat Romania
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between United and Expat is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Expat Romania BET in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expat Romania BET 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 Expat Romania. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expat Romania BET has no effect on the direction of United Rentals i.e., United Rentals and Expat Romania go up and down completely randomly.
Pair Corralation between United Rentals and Expat Romania
Considering the 90-day investment horizon United Rentals is expected to generate 1.78 times more return on investment than Expat Romania. However, United Rentals is 1.78 times more volatile than Expat Romania BET. It trades about 0.09 of its potential returns per unit of risk. Expat Romania BET is currently generating about 0.05 per unit of risk. If you would invest 35,864 in United Rentals on September 3, 2024 and sell it today you would earn a total of 50,736 from holding United Rentals or generate 141.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.02% |
| Values | Daily Returns |
United Rentals vs. Expat Romania BET
Performance |
| Timeline |
| United Rentals |
| Expat Romania BET |
United Rentals and Expat Romania Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Rentals and Expat Romania
The main advantage of trading using opposite United Rentals and Expat Romania positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals position performs unexpectedly, Expat Romania 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 Expat Romania will offset losses from the drop in Expat Romania'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 |
| Expat Romania vs. UBS Fund Solutions | Expat Romania vs. Xtrackers II | Expat Romania vs. Xtrackers Nikkei 225 | Expat Romania vs. iShares VII PLC |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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