Correlation Between MoneyLion and Uber Technologies

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

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

Diversification Opportunities for MoneyLion and Uber Technologies

0.03

Correlation Coefficient

MoneyLion  Uber Technologies

Significant diversification

The 3 months correlation between MoneyLion and Uber is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding MoneyLion and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies and MoneyLion 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 MoneyLion 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 MoneyLion i.e., MoneyLion and Uber Technologies go up and down completely randomly.

Pair Corralation between MoneyLion and Uber Technologies

Allowing for the 90-day total investment horizon MoneyLion is expected to under-perform the Uber Technologies. But the stock apears to be less risky and, when comparing its historical volatility, MoneyLion is 1.1 times less risky than Uber Technologies. The stock trades about -0.03 of its potential returns per unit of risk. The Uber Technologies is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  7,196  in Uber Technologies on November 29, 2024 and sell it today you would earn a total of  391.00  from holding Uber Technologies or generate 5.43% return on investment over 90 days.

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

MoneyLion  vs.  Uber Technologies

MoneyLion

Risk-Adjusted Performance

Very Weak

Over the last 90 days MoneyLion has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent essential indicators, MoneyLion is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Uber Technologies

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Uber Technologies are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating technical and fundamental indicators, Uber Technologies may actually be approaching a critical reversion point that can send shares even higher in March 2025.

Pair Trading with MoneyLion and Uber Technologies

The main advantage of trading using opposite MoneyLion and Uber Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MoneyLion 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 MoneyLion 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.