Correlation Between US Xpress and Covenant Logistics
Can any of the company-specific risk be diversified away by investing in both US Xpress and Covenant Logistics 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 US Xpress and Covenant Logistics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Xpress Enterprises and Covenant Logistics Group,, you can compare the effects of market volatilities on US Xpress and Covenant Logistics 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 US Xpress with a short position of Covenant Logistics. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Xpress and Covenant Logistics.
Diversification Opportunities for US Xpress and Covenant Logistics
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between USX and Covenant is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding US Xpress Enterprises and Covenant Logistics Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Covenant Logistics Group, and US Xpress 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 US Xpress Enterprises are associated (or correlated) with Covenant Logistics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Covenant Logistics Group, has no effect on the direction of US Xpress i.e., US Xpress and Covenant Logistics go up and down completely randomly.
Pair Corralation between US Xpress and Covenant Logistics
If you would invest 5,187 in Covenant Logistics Group, on August 27, 2024 and sell it today you would earn a total of 590.00 from holding Covenant Logistics Group, or generate 11.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 4.76% |
| Values | Daily Returns |
US Xpress Enterprises vs. Covenant Logistics Group,
Performance |
| Timeline |
| US Xpress Enterprises |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Covenant Logistics Group, |
US Xpress and Covenant Logistics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US Xpress and Covenant Logistics
The main advantage of trading using opposite US Xpress and Covenant Logistics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Xpress position performs unexpectedly, Covenant Logistics 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 Covenant Logistics will offset losses from the drop in Covenant Logistics' long position.| US Xpress vs. Heartland Express | US Xpress vs. Universal Logistics Holdings | US Xpress vs. Marten Transport | US Xpress vs. Werner Enterprises |
| Covenant Logistics vs. Marten Transport | Covenant Logistics vs. Werner Enterprises | Covenant Logistics vs. Universal Logistics Holdings | Covenant Logistics vs. Schneider National |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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