Correlation Between Uber Technologies and Beyond Oil

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

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

Diversification Opportunities for Uber Technologies and Beyond Oil

0.56

Correlation Coefficient

Uber Technologies  Beyond Oil

Very weak diversification

The 3 months correlation between Uber and Beyond is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies and Beyond Oil in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beyond Oil 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 Beyond Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beyond Oil has no effect on the direction of Uber Technologies i.e., Uber Technologies and Beyond Oil go up and down completely randomly.

Pair Corralation between Uber Technologies and Beyond Oil

Given the investment horizon of 90 days Uber Technologies is expected to generate 1.87 times less return on investment than Beyond Oil. But when comparing it to its historical volatility, Uber Technologies is 2.49 times less risky than Beyond Oil. It trades about 0.08 of its potential returns per unit of risk. Beyond Oil is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  48.00  in Beyond Oil on October 11, 2024 and sell it today you would earn a total of  65.00  from holding Beyond Oil or generate 135.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	93.94%
Values	Daily Returns

Uber Technologies  vs.  Beyond Oil

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.

Beyond Oil

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Beyond Oil has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, Beyond Oil is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Uber Technologies and Beyond Oil

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

The idea behind Uber Technologies and Beyond Oil 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.