Correlation Between Multi Ways and U Haul

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

By analyzing existing cross correlation between Multi Ways Holdings and U Haul Holding, you can compare the effects of market volatilities on Multi Ways and U Haul 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 Multi Ways with a short position of U Haul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi Ways and U Haul.

Diversification Opportunities for Multi Ways and U Haul

0.67

Correlation Coefficient

Multi Ways  U Haul

Poor diversification

The 3 months correlation between Multi and UHAL-B is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Multi Ways Holdings and U Haul Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on U Haul Holding and Multi Ways 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 Multi Ways Holdings are associated (or correlated) with U Haul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of U Haul Holding has no effect on the direction of Multi Ways i.e., Multi Ways and U Haul go up and down completely randomly.

Pair Corralation between Multi Ways and U Haul

Considering the 90-day investment horizon Multi Ways Holdings is expected to generate 2.14 times more return on investment than U Haul. However, Multi Ways is 2.14 times more volatile than U Haul Holding. It trades about 0.12 of its potential returns per unit of risk. U Haul Holding is currently generating about 0.03 per unit of risk. If you would invest  26.00  in Multi Ways Holdings on September 12, 2024 and sell it today you would earn a total of  2.00  from holding Multi Ways Holdings or generate 7.69% return on investment over 90 days.

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

Multi Ways Holdings  vs.  U Haul Holding

Multi Ways Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

U Haul Holding

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days U Haul Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, U Haul is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Multi Ways and U Haul

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

The idea behind Multi Ways Holdings and U Haul Holding 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.