Correlation Between United Rentals and China Railway
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By analyzing existing cross correlation between United Rentals and China Railway Materials, you can compare the effects of market volatilities on United Rentals and China Railway 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 China Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and China Railway.
Diversification Opportunities for United Rentals and China Railway
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between United and China is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and China Railway Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Railway Materials 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 China Railway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Railway Materials has no effect on the direction of United Rentals i.e., United Rentals and China Railway go up and down completely randomly.
Pair Corralation between United Rentals and China Railway
Considering the 90-day investment horizon United Rentals is expected to under-perform the China Railway. In addition to that, United Rentals is 1.66 times more volatile than China Railway Materials. It trades about -0.07 of its total potential returns per unit of risk. China Railway Materials is currently generating about -0.04 per unit of volatility. If you would invest 254.00 in China Railway Materials on December 2, 2024 and sell it today you would lose (5.00) from holding China Railway Materials or give up 1.97% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 92.5% |
Values | Daily Returns |
United Rentals vs. China Railway Materials
Performance |
Timeline |
United Rentals |
China Railway Materials |
United Rentals and China Railway Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with United Rentals and China Railway
The main advantage of trading using opposite United Rentals and China Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals position performs unexpectedly, China Railway 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 China Railway will offset losses from the drop in China Railway's long position.United Rentals vs. HE Equipment Services | United Rentals vs. GATX Corporation | United Rentals vs. McGrath RentCorp | United Rentals vs. Alta Equipment Group |
China Railway vs. Fujian Boss Software | China Railway vs. Shanghai Rightongene Biotechnology | China Railway vs. Thunder Software Technology | China Railway vs. Jinhe Biotechnology Co |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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