Correlation Between Dana and U Haul

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

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

Diversification Opportunities for Dana and U Haul

0.29

Correlation Coefficient

Dana  U Haul

Modest diversification

The 3 months correlation between Dana and UHAL is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Dana Inc 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 Dana 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 Dana Inc 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 Dana i.e., Dana and U Haul go up and down completely randomly.

Pair Corralation between Dana and U Haul

Considering the 90-day investment horizon Dana is expected to generate 52.72 times less return on investment than U Haul. In addition to that, Dana is 1.74 times more volatile than U Haul Holding. It trades about 0.0 of its total potential returns per unit of risk. U Haul Holding is currently generating about 0.06 per unit of volatility. If you would invest  5,926  in U Haul Holding on September 4, 2024 and sell it today you would earn a total of  1,309  from holding U Haul Holding or generate 22.09% return on investment over 90 days.

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

Dana Inc  vs.  U Haul Holding

Dana Inc

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Dana Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, Dana displayed solid returns over the last few months and may actually be approaching a breakup point.

U Haul Holding

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in U Haul Holding are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, U Haul is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Dana and U Haul

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

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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.