Correlation Between Air Lease and U Haul
Can any of the company-specific risk be diversified away by investing in both Air Lease and U Haul 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 Air Lease and U Haul into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Lease and U Haul Holding, you can compare the effects of market volatilities on Air Lease and U Haul 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 Air Lease with a short position of U Haul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Lease and U Haul.
Diversification Opportunities for Air Lease and U Haul
Weak diversification
The 3 months correlation between Air and UHAL is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Air Lease and U Haul Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Haul Holding and Air Lease 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 Air Lease are associated (or correlated) with U Haul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Haul Holding has no effect on the direction of Air Lease i.e., Air Lease and U Haul go up and down completely randomly.
Pair Corralation between Air Lease and U Haul
Allowing for the 90-day total investment horizon Air Lease is expected to generate 1.53 times more return on investment than U Haul. However, Air Lease is 1.53 times more volatile than U Haul Holding. It trades about 0.01 of its potential returns per unit of risk. U Haul Holding is currently generating about 0.01 per unit of risk. If you would invest 4,796 in Air Lease on December 2, 2024 and sell it today you would lose (4.00) from holding Air Lease or give up 0.08% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Air Lease vs. U Haul Holding
Performance |
Timeline |
Air Lease |
U Haul Holding |
Air Lease and U Haul Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Air Lease and U Haul
The main advantage of trading using opposite Air Lease and U Haul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Lease position performs unexpectedly, U Haul 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 U Haul will offset losses from the drop in U Haul's long position.Air Lease vs. Alta Equipment Group | Air Lease vs. McGrath RentCorp | Air Lease vs. Herc Holdings | Air Lease vs. HE Equipment Services |
U Haul vs. Air Lease | U Haul vs. HE Equipment Services | U Haul vs. GATX Corporation | U Haul vs. Custom Truck One |
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 CEOs Directory module to screen CEOs from public companies around the world.
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