Correlation Between Valvoline and Rush Enterprises

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

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

Diversification Opportunities for Valvoline and Rush Enterprises

0.59

Correlation Coefficient

Valvoline  Rush Enterprises

Very weak diversification

The 3 months correlation between Valvoline and Rush is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Valvoline and Rush Enterprises A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rush Enterprises A and Valvoline 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 Valvoline are associated (or correlated) with Rush Enterprises. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rush Enterprises A has no effect on the direction of Valvoline i.e., Valvoline and Rush Enterprises go up and down completely randomly.

Pair Corralation between Valvoline and Rush Enterprises

Considering the 90-day investment horizon Valvoline is expected to generate 3.86 times less return on investment than Rush Enterprises. In addition to that, Valvoline is 1.11 times more volatile than Rush Enterprises A. It trades about 0.02 of its total potential returns per unit of risk. Rush Enterprises A is currently generating about 0.1 per unit of volatility. If you would invest  4,825  in Rush Enterprises A on May 5, 2025 and sell it today you would earn a total of  530.00  from holding Rush Enterprises A or generate 10.98% return on investment over 90 days.

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

Valvoline  vs.  Rush Enterprises A

Valvoline

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Valvoline are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Valvoline is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Rush Enterprises A

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Rush Enterprises A are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical indicators, Rush Enterprises may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Valvoline and Rush Enterprises

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

The idea behind Valvoline and Rush Enterprises A 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.