Correlation Between Bill and U Haul

Can any of the company-specific risk be diversified away by investing in both Bill 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 Bill and U Haul into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Bill Com Holdings and U Haul Holding, you can compare the effects of market volatilities on Bill 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 Bill with a short position of U Haul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bill and U Haul.

Diversification Opportunities for Bill and U Haul

-0.57

Correlation Coefficient

Bill  U Haul

Excellent diversification

The 3 months correlation between Bill and UHAL is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Bill Com Holdings 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 Bill 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 Bill Com Holdings 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 Bill i.e., Bill and U Haul go up and down completely randomly.

Pair Corralation between Bill and U Haul

Given the investment horizon of 90 days Bill Com Holdings is expected to generate 1.85 times more return on investment than U Haul. However, Bill is 1.85 times more volatile than U Haul Holding. It trades about 0.03 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  8,159  in Bill Com Holdings on September 24, 2024 and sell it today you would earn a total of  793.00  from holding Bill Com Holdings or generate 9.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Bill Com Holdings  vs.  U Haul Holding

Bill Com Holdings

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bill Com Holdings are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile essential indicators, Bill disclosed solid returns over the last few months and may actually be approaching a breakup point.

U Haul Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days U Haul Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Bill and U Haul

The main advantage of trading using opposite Bill and U Haul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bill 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.

The idea behind Bill Com Holdings and U Haul Holding pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.