Correlation Between U Haul and Air Lease

Can any of the company-specific risk be diversified away by investing in both U Haul and Air Lease 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 U Haul and Air Lease into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between U Haul Holding and Air Lease, you can compare the effects of market volatilities on U Haul and Air Lease 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 U Haul with a short position of Air Lease. Check out your portfolio center. Please also check ongoing floating volatility patterns of U Haul and Air Lease.

Diversification Opportunities for U Haul and Air Lease

0.01

Correlation Coefficient

U Haul  Air Lease

Significant diversification

The 3 months correlation between UHAL-B and Air is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding U Haul Holding and Air Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Lease and U Haul 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 U Haul Holding are associated (or correlated) with Air Lease. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Lease has no effect on the direction of U Haul i.e., U Haul and Air Lease go up and down completely randomly.

Pair Corralation between U Haul and Air Lease

Assuming the 90 days trading horizon U Haul Holding is expected to under-perform the Air Lease. In addition to that, U Haul is 1.28 times more volatile than Air Lease. It trades about -0.08 of its total potential returns per unit of risk. Air Lease is currently generating about 0.05 per unit of volatility. If you would invest  5,247  in Air Lease on May 6, 2025 and sell it today you would earn a total of  188.00  from holding Air Lease or generate 3.58% return on investment over 90 days.

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

U Haul Holding  vs.  Air Lease

U Haul Holding

Risk-Adjusted Performance

Very Weak

Over the last 90 days U Haul Holding has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Air Lease

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Air Lease are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent essential indicators, Air Lease is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with U Haul and Air Lease

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

The idea behind U Haul Holding and Air Lease 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.