Correlation Between Landstar System and CH Robinson

Can any of the company-specific risk be diversified away by investing in both Landstar System and CH Robinson 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 Landstar System and CH Robinson into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Landstar System and CH Robinson Worldwide, you can compare the effects of market volatilities on Landstar System and CH Robinson 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 Landstar System with a short position of CH Robinson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Landstar System and CH Robinson.

Diversification Opportunities for Landstar System and CH Robinson

0.22

Correlation Coefficient

Landstar System  CH Robinson

Modest diversification

The 3 months correlation between Landstar and CHRW is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Landstar System and CH Robinson Worldwide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CH Robinson Worldwide and Landstar System 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 Landstar System are associated (or correlated) with CH Robinson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CH Robinson Worldwide has no effect on the direction of Landstar System i.e., Landstar System and CH Robinson go up and down completely randomly.

Pair Corralation between Landstar System and CH Robinson

Given the investment horizon of 90 days Landstar System is expected to under-perform the CH Robinson. But the stock apears to be less risky and, when comparing its historical volatility, Landstar System is 1.59 times less risky than CH Robinson. The stock trades about -0.02 of its potential returns per unit of risk. The CH Robinson Worldwide is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  8,775  in CH Robinson Worldwide on May 6, 2025 and sell it today you would earn a total of  2,766  from holding CH Robinson Worldwide or generate 31.53% return on investment over 90 days.

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

Landstar System  vs.  CH Robinson Worldwide

Landstar System

Risk-Adjusted Performance

Very Weak

Over the last 90 days Landstar System has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Landstar System is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

CH Robinson Worldwide

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CH Robinson Worldwide are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain basic indicators, CH Robinson showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Landstar System and CH Robinson

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

The idea behind Landstar System and CH Robinson Worldwide 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.