Correlation Between Rogers Communications and United Airlines

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

By analyzing existing cross correlation between Rogers Communications and United Airlines Holdings, you can compare the effects of market volatilities on Rogers Communications and United Airlines 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 Rogers Communications with a short position of United Airlines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rogers Communications and United Airlines.

Diversification Opportunities for Rogers Communications and United Airlines

0.61

Correlation Coefficient

Rogers Communications  United Airlines

Poor diversification

The 3 months correlation between Rogers and United is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Rogers Communications and United Airlines Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on United Airlines Holdings and Rogers Communications 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 Rogers Communications are associated (or correlated) with United Airlines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of United Airlines Holdings has no effect on the direction of Rogers Communications i.e., Rogers Communications and United Airlines go up and down completely randomly.

Pair Corralation between Rogers Communications and United Airlines

Assuming the 90 days trading horizon Rogers Communications is expected to generate 1.24 times less return on investment than United Airlines. But when comparing it to its historical volatility, Rogers Communications is 2.54 times less risky than United Airlines. It trades about 0.3 of its potential returns per unit of risk. United Airlines Holdings is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  5,919  in United Airlines Holdings on April 24, 2025 and sell it today you would earn a total of  2,021  from holding United Airlines Holdings or generate 34.14% return on investment over 90 days.

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

Rogers Communications  vs.  United Airlines Holdings

Rogers Communications

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Rogers Communications are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain forward indicators, Rogers Communications reported solid returns over the last few months and may actually be approaching a breakup point.

United Airlines Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in United Airlines Holdings are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile essential indicators, United Airlines reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Rogers Communications and United Airlines

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

The idea behind Rogers Communications and United Airlines Holdings 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.