Correlation Between Uber Technologies and Powell Max

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

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

Diversification Opportunities for Uber Technologies and Powell Max

0.43

Correlation Coefficient

Uber Technologies  Powell Max

Very weak diversification

The 3 months correlation between Uber and Powell is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies and Powell Max Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Powell Max Limited 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 Powell Max. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Powell Max Limited has no effect on the direction of Uber Technologies i.e., Uber Technologies and Powell Max go up and down completely randomly.

Pair Corralation between Uber Technologies and Powell Max

Given the investment horizon of 90 days Uber Technologies is expected to generate 0.27 times more return on investment than Powell Max. However, Uber Technologies is 3.65 times less risky than Powell Max. It trades about -0.07 of its potential returns per unit of risk. Powell Max Limited is currently generating about -0.32 per unit of risk. If you would invest  7,769  in Uber Technologies on October 26, 2024 and sell it today you would lose (913.00) from holding Uber Technologies or give up 11.75% 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.  Powell Max Limited

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 latest unfluctuating performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Powell Max Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Powell Max Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Uber Technologies and Powell Max

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

The idea behind Uber Technologies and Powell Max Limited 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.