Correlation Between Uber Technologies and Vertex Energy

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Uber Technologies and Vertex Energy 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 Vertex Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Uber Technologies and Vertex Energy, you can compare the effects of market volatilities on Uber Technologies and Vertex Energy 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 Vertex Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Uber Technologies and Vertex Energy.

Diversification Opportunities for Uber Technologies and Vertex Energy

-0.31
  Correlation Coefficient

Very good diversification

The 3 months correlation between Uber Technologies and Vertex is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Uber Technologies and Vertex Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vertex Energy 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 Vertex Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vertex Energy has no effect on the direction of Uber Technologies i.e., Uber Technologies and Vertex Energy go up and down completely randomly.

Pair Corralation between Uber Technologies and Vertex Energy

Given the investment horizon of 90 days Uber Technologies is expected to under-perform the Vertex Energy. But the stock apears to be less risky and, when comparing its historical volatility, Uber Technologies is 3.06 times less risky than Vertex Energy. The stock trades about -0.03 of its potential returns per unit of risk. The Vertex Energy is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  175.00  in Vertex Energy on May 20, 2022 and sell it today you would earn a total of  537.00  from holding Vertex Energy or generate 306.86% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Uber Technologies  vs.  Vertex Energy

 Performance (%) 
       Timeline  
Uber Technologies 
Uber Technologies Performance
9 of 100
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. Even with relatively weak technical and fundamental indicators, Uber Technologies reported solid returns over the last few months and may actually be approaching a breakup point.

Uber Technologies Price Channel

Vertex Energy 
Vertex Performance
0 of 100
Over the last 90 days Vertex Energy has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in September 2022. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Vertex Price Channel

Uber Technologies and Vertex Energy Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Uber Technologies and Vertex Energy

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

Uber Technologies

Pair trading matchups for Uber Technologies

Global Clean vs. Uber Technologies
SPDR SP vs. Uber Technologies
SP 500 vs. Uber Technologies
Schwab US vs. Uber Technologies
JP Morgan vs. Uber Technologies
Ford vs. Uber Technologies
Alibaba Group vs. Uber Technologies
Salesforce vs. Uber Technologies
Vmware vs. Uber Technologies
Vici Properties vs. Uber Technologies
Paypal Holdings vs. Uber Technologies
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Uber Technologies as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Uber Technologies' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Uber Technologies' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Uber Technologies.
The idea behind Uber Technologies and Vertex Energy 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.

Vertex Energy

Pair trading matchups for Vertex Energy

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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.

Other Complementary Tools

Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
Go
Analyst Recommendations
Analyst recommendations and target price estimates broken down by several categories
Go
Equity Analysis
Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities
Go
Commodity Channel Index
Use Commodity Channel Index to analyze current equity momentum
Go
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Go
Options Analysis
Analyze and evaluate options and option chains as a potential hedge for your portfolios
Go
Fund Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Go
Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
Go
Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go