Correlation Between United Rentals and Bonava AB
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By analyzing existing cross correlation between United Rentals and Bonava AB, you can compare the effects of market volatilities on United Rentals and Bonava AB 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 Bonava AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Rentals and Bonava AB.
Diversification Opportunities for United Rentals and Bonava AB
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between United and Bonava is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding United Rentals and Bonava AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bonava AB 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 Bonava AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bonava AB has no effect on the direction of United Rentals i.e., United Rentals and Bonava AB go up and down completely randomly.
Pair Corralation between United Rentals and Bonava AB
Considering the 90-day investment horizon United Rentals is expected to generate 0.7 times more return on investment than Bonava AB. However, United Rentals is 1.43 times less risky than Bonava AB. It trades about 0.18 of its potential returns per unit of risk. Bonava AB is currently generating about 0.04 per unit of risk. If you would invest 70,275 in United Rentals on September 10, 2024 and sell it today you would earn a total of 15,617 from holding United Rentals or generate 22.22% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 98.46% |
Values | Daily Returns |
United Rentals vs. Bonava AB
Performance |
Timeline |
United Rentals |
Bonava AB |
United Rentals and Bonava AB Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with United Rentals and Bonava AB
The main advantage of trading using opposite United Rentals and Bonava AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Rentals position performs unexpectedly, Bonava AB 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 Bonava AB will offset losses from the drop in Bonava AB'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 |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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