Correlation Between National Bank and Uber Technologies

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Can any of the company-specific risk be diversified away by investing in both National Bank and Uber Technologies 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 National Bank and Uber Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank of and Uber Technologies, you can compare the effects of market volatilities on National Bank and Uber Technologies 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 National Bank with a short position of Uber Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Uber Technologies.

Diversification Opportunities for National Bank and Uber Technologies

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between National and Uber is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies and National Bank 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 National Bank of are associated (or correlated) with Uber Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uber Technologies has no effect on the direction of National Bank i.e., National Bank and Uber Technologies go up and down completely randomly.

Pair Corralation between National Bank and Uber Technologies

If you would invest  6,920  in Uber Technologies on September 4, 2024 and sell it today you would earn a total of  385.00  from holding Uber Technologies or generate 5.56% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy98.46%
ValuesDaily Returns

National Bank of  vs.  Uber Technologies

 Performance 
       Timeline  
National Bank 

Risk-Adjusted Performance

0 of 100

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

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Uber Technologies are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent essential indicators, Uber Technologies is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

National Bank and Uber Technologies Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with National Bank and Uber Technologies

The main advantage of trading using opposite National Bank and Uber Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Uber Technologies 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 Uber Technologies will offset losses from the drop in Uber Technologies' long position.
The idea behind National Bank of and Uber Technologies 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.

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