Correlation Between Chegg and WT OFFSHORE

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

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

Diversification Opportunities for Chegg and WT OFFSHORE

-0.42

Correlation Coefficient

Chegg  WT OFFSHORE

Very good diversification

The 3 months correlation between Chegg and UWV is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Chegg Inc and WT OFFSHORE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WT OFFSHORE and Chegg 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 Chegg Inc are associated (or correlated) with WT OFFSHORE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WT OFFSHORE has no effect on the direction of Chegg i.e., Chegg and WT OFFSHORE go up and down completely randomly.

Pair Corralation between Chegg and WT OFFSHORE

Assuming the 90 days horizon Chegg Inc is expected to under-perform the WT OFFSHORE. In addition to that, Chegg is 1.58 times more volatile than WT OFFSHORE. It trades about -0.07 of its total potential returns per unit of risk. WT OFFSHORE is currently generating about -0.06 per unit of volatility. If you would invest  543.00  in WT OFFSHORE on October 11, 2024 and sell it today you would lose (383.00) from holding WT OFFSHORE or give up 70.53% of portfolio value over 90 days.

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

Chegg Inc  vs.  WT OFFSHORE

Chegg Inc

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Chegg Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Chegg reported solid returns over the last few months and may actually be approaching a breakup point.

WT OFFSHORE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days WT OFFSHORE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Pair Trading with Chegg and WT OFFSHORE

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

The idea behind Chegg Inc and WT OFFSHORE 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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.