Correlation Between QUEEN S and Chegg

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

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

Diversification Opportunities for QUEEN S and Chegg

0.8

Correlation Coefficient

QUEEN S  Chegg

Very poor diversification

The 3 months correlation between QUEEN and Chegg is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding QUEEN S ROAD and Chegg Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chegg Inc and QUEEN S 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 QUEEN S ROAD are associated (or correlated) with Chegg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chegg Inc has no effect on the direction of QUEEN S i.e., QUEEN S and Chegg go up and down completely randomly.

Pair Corralation between QUEEN S and Chegg

Assuming the 90 days horizon QUEEN S ROAD is expected to generate 0.35 times more return on investment than Chegg. However, QUEEN S ROAD is 2.85 times less risky than Chegg. It trades about -0.14 of its potential returns per unit of risk. Chegg Inc is currently generating about -0.18 per unit of risk. If you would invest  464.00  in QUEEN S ROAD on December 21, 2024 and sell it today you would lose (82.00) from holding QUEEN S ROAD or give up 17.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	96.61%
Values	Daily Returns

QUEEN S ROAD  vs.  Chegg Inc

QUEEN S ROAD

Risk-Adjusted Performance

Very Weak

Over the last 90 days QUEEN S ROAD has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Chegg Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Chegg Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with QUEEN S and Chegg

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

The idea behind QUEEN S ROAD and Chegg Inc 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.