Correlation Between United Rentals and Sellas Life
Can any of the company-specific risk be diversified away by investing in both United Rentals and Sellas Life 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 Sellas Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Rentals and Sellas Life Sciences, you can compare the effects of market volatilities on United Rentals and Sellas Life 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 Sellas Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Sellas Life.
Diversification Opportunities for United Rentals and Sellas Life
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between United and Sellas is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Sellas Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sellas Life Sciences 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 Sellas Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sellas Life Sciences has no effect on the direction of United Rentals i.e., United Rentals and Sellas Life go up and down completely randomly.
Pair Corralation between United Rentals and Sellas Life
Considering the 90-day investment horizon United Rentals is expected to generate 0.77 times more return on investment than Sellas Life. However, United Rentals is 1.3 times less risky than Sellas Life. It trades about 0.17 of its potential returns per unit of risk. Sellas Life Sciences is currently generating about 0.0 per unit of risk. If you would invest 78,451 in United Rentals on September 4, 2024 and sell it today you would earn a total of 7,254 from holding United Rentals or generate 9.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Rentals vs. Sellas Life Sciences
Performance |
| Timeline |
| United Rentals |
| Sellas Life Sciences |
United Rentals and Sellas Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Rentals and Sellas Life
The main advantage of trading using opposite United Rentals and Sellas Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals position performs unexpectedly, Sellas Life 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 Sellas Life will offset losses from the drop in Sellas Life'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 |
| Sellas Life vs. Candel Therapeutics | Sellas Life vs. Cingulate Warrants | Sellas Life vs. Unicycive Therapeutics | Sellas Life vs. Cardio Diagnostics Holdings |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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