Correlation Between Covenant Logistics and US Xpress

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

By analyzing existing cross correlation between Covenant Logistics Group, and US Xpress Enterprises, you can compare the effects of market volatilities on Covenant Logistics and US Xpress 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 Covenant Logistics with a short position of US Xpress. Check out your portfolio center. Please also check ongoing floating volatility patterns of Covenant Logistics and US Xpress.

Diversification Opportunities for Covenant Logistics and US Xpress

0.0

Correlation Coefficient

Covenant Logistics  US Xpress

Pay attention - limited upside

The 3 months correlation between Covenant and USX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Covenant Logistics Group, and US Xpress Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Xpress Enterprises and Covenant Logistics 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 Covenant Logistics Group, are associated (or correlated) with US Xpress. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Xpress Enterprises has no effect on the direction of Covenant Logistics i.e., Covenant Logistics and US Xpress go up and down completely randomly.

Pair Corralation between Covenant Logistics and US Xpress

If you would invest (100.00) in US Xpress Enterprises on December 28, 2024 and sell it today you would earn a total of  100.00  from holding US Xpress Enterprises or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Covenant Logistics Group,  vs.  US Xpress Enterprises

Covenant Logistics Group,

Risk-Adjusted Performance

Very Weak

Over the last 90 days Covenant Logistics Group, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's essential indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

US Xpress Enterprises

Risk-Adjusted Performance

Very Weak

Over the last 90 days US Xpress Enterprises has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, US Xpress is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Covenant Logistics and US Xpress

The main advantage of trading using opposite Covenant Logistics and US Xpress positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Covenant Logistics position performs unexpectedly, US Xpress 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 US Xpress will offset losses from the drop in US Xpress' long position.

The idea behind Covenant Logistics Group, and US Xpress Enterprises 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.

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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.