Correlation Between Uber Technologies and United Fire
Can any of the company-specific risk be diversified away by investing in both Uber Technologies and United Fire 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 United Fire into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uber Technologies and United Fire Group, you can compare the effects of market volatilities on Uber Technologies and United Fire 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 United Fire. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uber Technologies and United Fire.
Diversification Opportunities for Uber Technologies and United Fire
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Uber and United is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies and United Fire Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Fire 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 United Fire. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Fire Group has no effect on the direction of Uber Technologies i.e., Uber Technologies and United Fire go up and down completely randomly.
Pair Corralation between Uber Technologies and United Fire
Given the investment horizon of 90 days Uber Technologies is expected to generate 1.31 times more return on investment than United Fire. However, Uber Technologies is 1.31 times more volatile than United Fire Group. It trades about 0.18 of its potential returns per unit of risk. United Fire Group is currently generating about -0.01 per unit of risk. If you would invest 6,317 in Uber Technologies on December 2, 2024 and sell it today you would earn a total of 1,284 from holding Uber Technologies or generate 20.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Uber Technologies vs. United Fire Group
Performance |
Timeline |
Uber Technologies |
United Fire Group |
Uber Technologies and United Fire Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Uber Technologies and United Fire
The main advantage of trading using opposite Uber Technologies and United Fire positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Uber Technologies position performs unexpectedly, United Fire 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 United Fire will offset losses from the drop in United Fire's long position.Uber Technologies vs. Zoom Video Communications | Uber Technologies vs. Snowflake | Uber Technologies vs. Workday | Uber Technologies vs. C3 Ai Inc |
United Fire vs. Donegal Group B | United Fire vs. Horace Mann Educators | United Fire vs. Donegal Group A | United Fire vs. Global Indemnity PLC |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
Equity Valuation Check real value of public entities based on technical and fundamental data | |
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Stocks Directory Find actively traded stocks across global markets | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |