Correlation Between United Rentals and Lendlease

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

By analyzing existing cross correlation between United Rentals and Lendlease Group, you can compare the effects of market volatilities on United Rentals and Lendlease 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 United Rentals with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Lendlease.

Diversification Opportunities for United Rentals and Lendlease

0.75

Correlation Coefficient

United Rentals  Lendlease

Poor diversification

The 3 months correlation between United and Lendlease is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and United Rentals 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 United Rentals are associated (or correlated) with Lendlease. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lendlease Group has no effect on the direction of United Rentals i.e., United Rentals and Lendlease go up and down completely randomly.

Pair Corralation between United Rentals and Lendlease

Assuming the 90 days horizon United Rentals is expected to under-perform the Lendlease. In addition to that, United Rentals is 1.68 times more volatile than Lendlease Group. It trades about -0.11 of its total potential returns per unit of risk. Lendlease Group is currently generating about -0.02 per unit of volatility. If you would invest  365.00  in Lendlease Group on December 23, 2024 and sell it today you would lose (8.00) from holding Lendlease Group or give up 2.19% of portfolio value over 90 days.

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

United Rentals  vs.  Lendlease Group

United Rentals

Risk-Adjusted Performance

Very Weak

Over the last 90 days United Rentals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Lendlease Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lendlease Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Lendlease is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with United Rentals and Lendlease

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

The idea behind United Rentals and Lendlease Group 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.