Correlation Between Highway Hlds and AVIS BUDGET

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

Diversification Opportunities for Highway Hlds and AVIS BUDGET

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Highway and AVIS BUDGET is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Highway Hlds and AVIS BUDGET GROUP DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AVIS BUDGET GROUP and Highway Hlds 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 Highway Hlds are associated (or correlated) with AVIS BUDGET. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AVIS BUDGET GROUP has no effect on the direction of Highway Hlds i.e., Highway Hlds and AVIS BUDGET go up and down completely randomly.

Pair Corralation between Highway Hlds and AVIS BUDGET

If you would invest  224.00  in Highway Hlds on August 28, 2022 and sell it today you would earn a total of  1.00  from holding Highway Hlds or generate 0.45% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Highway Hlds  vs.  AVIS BUDGET GROUP DL 01

 Performance (%) 
       Timeline  
Highway Hlds 
Highway Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Highway Hlds are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent technical indicators, Highway Hlds is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Highway Price Channel

AVIS BUDGET GROUP 
AVIS BUDGET Performance
0 of 100
Over the last 90 days AVIS BUDGET GROUP has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, AVIS BUDGET is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Highway Hlds and AVIS BUDGET Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Highway Hlds and AVIS BUDGET

The main advantage of trading using opposite Highway Hlds and AVIS BUDGET positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highway Hlds position performs unexpectedly, AVIS BUDGET 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 AVIS BUDGET will offset losses from the drop in AVIS BUDGET's long position.
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The idea behind Highway Hlds and AVIS BUDGET GROUP 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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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 Analyst Recommendations module to analyst recommendations and target price estimates broken down by several categories.

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