Correlation Between Uber Technologies and Catheter Precision

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

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

Diversification Opportunities for Uber Technologies and Catheter Precision

0.64

Correlation Coefficient

Uber Technologies  Catheter Precision

Poor diversification

The 3 months correlation between Uber and Catheter is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies and Catheter Precision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catheter Precision 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 Catheter Precision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catheter Precision has no effect on the direction of Uber Technologies i.e., Uber Technologies and Catheter Precision go up and down completely randomly.

Pair Corralation between Uber Technologies and Catheter Precision

Given the investment horizon of 90 days Uber Technologies is expected to under-perform the Catheter Precision. But the stock apears to be less risky and, when comparing its historical volatility, Uber Technologies is 2.52 times less risky than Catheter Precision. The stock trades about -0.07 of its potential returns per unit of risk. The Catheter Precision is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  41.00  in Catheter Precision on October 25, 2024 and sell it today you would earn a total of  1.15  from holding Catheter Precision or generate 2.8% return on investment over 90 days.

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

Uber Technologies  vs.  Catheter Precision

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.

Catheter Precision

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Catheter Precision has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Uber Technologies and Catheter Precision

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

The idea behind Uber Technologies and Catheter Precision 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.