Correlation Between Strawberry Fields and Uber Technologies

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

Diversification Opportunities for Strawberry Fields and Uber Technologies

-0.55
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Strawberry and Uber Technologies is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Strawberry Fields REIT and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies and Strawberry Fields 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 Strawberry Fields REIT 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 Strawberry Fields i.e., Strawberry Fields and Uber Technologies go up and down completely randomly.

Pair Corralation between Strawberry Fields and Uber Technologies

Given the investment horizon of 90 days Strawberry Fields REIT is expected to under-perform the Uber Technologies. In addition to that, Strawberry Fields is 1.42 times more volatile than Uber Technologies. It trades about -0.04 of its total potential returns per unit of risk. Uber Technologies is currently generating about -0.01 per unit of volatility. If you would invest  3,573  in Uber Technologies on September 8, 2022 and sell it today you would lose (881.00)  from holding Uber Technologies or give up 24.66% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy21.77%
ValuesDaily Returns

Strawberry Fields REIT  vs.  Uber Technologies

 Performance (%) 
       Timeline  
Strawberry Fields REIT 
Strawberry Performance
0 of 100
Over the last 90 days Strawberry Fields REIT has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2023. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Strawberry Price Channel

Uber Technologies 
Uber Technologies Performance
0 of 100
Over the last 90 days Uber Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Uber Technologies Price Channel

Strawberry Fields and Uber Technologies Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Strawberry Fields and Uber Technologies

The main advantage of trading using opposite Strawberry Fields and Uber Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strawberry Fields 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.
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The idea behind Strawberry Fields REIT 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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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.

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