Correlation Between Eisai Co and U Haul

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

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

Diversification Opportunities for Eisai Co and U Haul

0.14

Correlation Coefficient

Eisai Co  U Haul

Average diversification

The 3 months correlation between Eisai and UHAL is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Eisai Co 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 Eisai Co 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 Eisai Co 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 Eisai Co i.e., Eisai Co and U Haul go up and down completely randomly.

Pair Corralation between Eisai Co and U Haul

Assuming the 90 days horizon Eisai Co is expected to generate 1.06 times more return on investment than U Haul. However, Eisai Co is 1.06 times more volatile than U Haul Holding. It trades about 0.06 of its potential returns per unit of risk. U Haul Holding is currently generating about -0.06 per unit of risk. If you would invest  677.00  in Eisai Co on December 28, 2024 and sell it today you would earn a total of  36.00  from holding Eisai Co or generate 5.32% return on investment over 90 days.

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

Eisai Co  vs.  U Haul Holding

Eisai Co

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Eisai Co are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong forward indicators, Eisai Co is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

U Haul Holding

Risk-Adjusted Performance

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 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 Eisai Co and U Haul

The main advantage of trading using opposite Eisai Co and U Haul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eisai Co 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 Eisai Co 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 Transaction History module to view history of all your transactions and understand their impact on performance.