Correlation Between Uber Technologies and Azure Holding

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

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

Diversification Opportunities for Uber Technologies and Azure Holding

0.55

Correlation Coefficient

Uber Technologies  Azure Holding

Very weak diversification

The 3 months correlation between Uber and Azure is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies and Azure Holding Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azure Holding Group and Uber Technologies 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 Uber Technologies are associated (or correlated) with Azure Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azure Holding Group has no effect on the direction of Uber Technologies i.e., Uber Technologies and Azure Holding go up and down completely randomly.

Pair Corralation between Uber Technologies and Azure Holding

Given the investment horizon of 90 days Uber Technologies is expected to under-perform the Azure Holding. But the stock apears to be less risky and, when comparing its historical volatility, Uber Technologies is 7.27 times less risky than Azure Holding. The stock trades about -0.03 of its potential returns per unit of risk. The Azure Holding Group is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  16.00  in Azure Holding Group on October 8, 2024 and sell it today you would lose (3.00) from holding Azure Holding Group or give up 18.75% of portfolio value over 90 days.

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

Uber Technologies  vs.  Azure Holding Group

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.

Azure Holding Group

Risk-Adjusted Performance

7 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Azure Holding Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak basic indicators, Azure Holding demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Uber Technologies and Azure Holding

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

The idea behind Uber Technologies and Azure Holding Group 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..