Correlation Between Uber Technologies and INGERSOLL

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

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

Diversification Opportunities for Uber Technologies and INGERSOLL

0.07

Correlation Coefficient

Uber Technologies  INGERSOLL

Significant diversification

The 3 months correlation between Uber and INGERSOLL is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies and INGERSOLL RAND GLOBAL HLDG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INGERSOLL RAND GLOBAL 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 INGERSOLL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INGERSOLL RAND GLOBAL has no effect on the direction of Uber Technologies i.e., Uber Technologies and INGERSOLL go up and down completely randomly.

Pair Corralation between Uber Technologies and INGERSOLL

Given the investment horizon of 90 days Uber Technologies is expected to under-perform the INGERSOLL. In addition to that, Uber Technologies is 2.53 times more volatile than INGERSOLL RAND GLOBAL HLDG. It trades about -0.29 of its total potential returns per unit of risk. INGERSOLL RAND GLOBAL HLDG is currently generating about -0.07 per unit of volatility. If you would invest  10,444  in INGERSOLL RAND GLOBAL HLDG on September 25, 2024 and sell it today you would lose (102.00) from holding INGERSOLL RAND GLOBAL HLDG or give up 0.98% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	60.0%
Values	Daily Returns

Uber Technologies  vs.  INGERSOLL RAND GLOBAL HLDG

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 uncertain performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

INGERSOLL RAND GLOBAL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days INGERSOLL RAND GLOBAL HLDG has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for INGERSOLL RAND GLOBAL HLDG investors.

Pair Trading with Uber Technologies and INGERSOLL

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

The idea behind Uber Technologies and INGERSOLL RAND GLOBAL HLDG 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.