Correlation Between FactSet Research and Uber Technologies

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

By analyzing existing cross correlation between FactSet Research Systems and Uber Technologies, you can compare the effects of market volatilities on FactSet Research and Uber Technologies 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 FactSet Research with a short position of Uber Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of FactSet Research and Uber Technologies.

Diversification Opportunities for FactSet Research and Uber Technologies

-0.65

Correlation Coefficient

FactSet Research  Uber Technologies

Excellent diversification

The 3 months correlation between FactSet and Uber is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding FactSet Research Systems and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies and FactSet Research 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 FactSet Research Systems are associated (or correlated) with Uber Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uber Technologies has no effect on the direction of FactSet Research i.e., FactSet Research and Uber Technologies go up and down completely randomly.

Pair Corralation between FactSet Research and Uber Technologies

Considering the 90-day investment horizon FactSet Research Systems is expected to generate 0.4 times more return on investment than Uber Technologies. However, FactSet Research Systems is 2.47 times less risky than Uber Technologies. It trades about 0.03 of its potential returns per unit of risk. Uber Technologies is currently generating about -0.08 per unit of risk. If you would invest  45,307  in FactSet Research Systems on October 10, 2024 and sell it today you would earn a total of  761.00  from holding FactSet Research Systems or generate 1.68% return on investment over 90 days.

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

FactSet Research Systems  vs.  Uber Technologies

FactSet Research Systems

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in FactSet Research Systems are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable fundamental indicators, FactSet Research is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Uber Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Uber Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with FactSet Research and Uber Technologies

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

The idea behind FactSet Research Systems and Uber Technologies 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.