Correlation Between United Rentals and Zoomcar Holdings
Can any of the company-specific risk be diversified away by investing in both United Rentals and Zoomcar Holdings 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 Zoomcar Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Rentals and Zoomcar Holdings, you can compare the effects of market volatilities on United Rentals and Zoomcar Holdings 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 Zoomcar Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Zoomcar Holdings.
Diversification Opportunities for United Rentals and Zoomcar Holdings
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between United and Zoomcar is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Zoomcar Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zoomcar Holdings 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 Zoomcar Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zoomcar Holdings has no effect on the direction of United Rentals i.e., United Rentals and Zoomcar Holdings go up and down completely randomly.
Pair Corralation between United Rentals and Zoomcar Holdings
Considering the 90-day investment horizon United Rentals is expected to generate 0.12 times more return on investment than Zoomcar Holdings. However, United Rentals is 8.2 times less risky than Zoomcar Holdings. It trades about 0.11 of its potential returns per unit of risk. Zoomcar Holdings is currently generating about -0.04 per unit of risk. If you would invest 47,173 in United Rentals on August 26, 2024 and sell it today you would earn a total of 37,759 from holding United Rentals or generate 80.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Rentals vs. Zoomcar Holdings
Performance |
| Timeline |
| United Rentals |
| Zoomcar Holdings |
United Rentals and Zoomcar Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Rentals and Zoomcar Holdings
The main advantage of trading using opposite United Rentals and Zoomcar Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals position performs unexpectedly, Zoomcar Holdings 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 Zoomcar Holdings will offset losses from the drop in Zoomcar Holdings' long position.| United Rentals vs. PROG Holdings | United Rentals vs. McGrath RentCorp | United Rentals vs. Mega Matrix Corp | United Rentals vs. FTAI Aviation Ltd |
| Zoomcar Holdings vs. Lipocine | Zoomcar Holdings vs. Coursera | Zoomcar Holdings vs. Pearson PLC ADR | Zoomcar Holdings vs. Skillful Craftsman Education |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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