Correlation Between Uber Technologies and Quantgate Systems

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

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

Diversification Opportunities for Uber Technologies and Quantgate Systems

-0.74

Correlation Coefficient

Uber Technologies  Quantgate Systems

Pay attention - limited upside

The 3 months correlation between Uber and Quantgate is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies and Quantgate Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantgate Systems and Uber Technologies 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 Uber Technologies are associated (or correlated) with Quantgate Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantgate Systems has no effect on the direction of Uber Technologies i.e., Uber Technologies and Quantgate Systems go up and down completely randomly.

Pair Corralation between Uber Technologies and Quantgate Systems

Given the investment horizon of 90 days Uber Technologies is expected to under-perform the Quantgate Systems. But the stock apears to be less risky and, when comparing its historical volatility, Uber Technologies is 8.03 times less risky than Quantgate Systems. The stock trades about -0.08 of its potential returns per unit of risk. The Quantgate Systems is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  0.76  in Quantgate Systems on September 16, 2024 and sell it today you would earn a total of  2.24  from holding Quantgate Systems or generate 294.74% return on investment over 90 days.

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

Uber Technologies  vs.  Quantgate Systems

Uber Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Uber Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in January 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Quantgate Systems

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Quantgate Systems are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite fairly unfluctuating basic indicators, Quantgate Systems demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Uber Technologies and Quantgate Systems

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

The idea behind Uber Technologies and Quantgate Systems 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.