Correlation Between UNITED RENTALS and SEEK

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

By analyzing existing cross correlation between UNITED RENTALS and SEEK Limited, you can compare the effects of market volatilities on UNITED RENTALS and SEEK 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 UNITED RENTALS with a short position of SEEK. Check out your portfolio center. Please also check ongoing floating volatility patterns of UNITED RENTALS and SEEK.

Diversification Opportunities for UNITED RENTALS and SEEK

0.3

Correlation Coefficient

UNITED RENTALS  SEEK

Weak diversification

The 3 months correlation between UNITED and SEEK is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding UNITED RENTALS and SEEK Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SEEK Limited and UNITED RENTALS 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 UNITED RENTALS are associated (or correlated) with SEEK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SEEK Limited has no effect on the direction of UNITED RENTALS i.e., UNITED RENTALS and SEEK go up and down completely randomly.

Pair Corralation between UNITED RENTALS and SEEK

Assuming the 90 days trading horizon UNITED RENTALS is expected to generate 1.33 times more return on investment than SEEK. However, UNITED RENTALS is 1.33 times more volatile than SEEK Limited. It trades about 0.18 of its potential returns per unit of risk. SEEK Limited is currently generating about 0.11 per unit of risk. If you would invest  63,749  in UNITED RENTALS on May 17, 2025 and sell it today you would earn a total of  15,311  from holding UNITED RENTALS or generate 24.02% return on investment over 90 days.

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

UNITED RENTALS  vs.  SEEK Limited

UNITED RENTALS

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in UNITED RENTALS are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, UNITED RENTALS exhibited solid returns over the last few months and may actually be approaching a breakup point.

SEEK Limited

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in SEEK Limited are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, SEEK may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with UNITED RENTALS and SEEK

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

The idea behind UNITED RENTALS and SEEK Limited 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.