Correlation Between FLAT GLASS and STRAYER EDUCATION

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

By analyzing existing cross correlation between FLAT GLASS GROUP and STRAYER EDUCATION, you can compare the effects of market volatilities on FLAT GLASS and STRAYER EDUCATION 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 FLAT GLASS with a short position of STRAYER EDUCATION. Check out your portfolio center. Please also check ongoing floating volatility patterns of FLAT GLASS and STRAYER EDUCATION.

Diversification Opportunities for FLAT GLASS and STRAYER EDUCATION

-0.11

Correlation Coefficient

FLAT GLASS  STRAYER EDUCATION

Good diversification

The 3 months correlation between FLAT and STRAYER is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding FLAT GLASS GROUP and STRAYER EDUCATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STRAYER EDUCATION and FLAT GLASS 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 FLAT GLASS GROUP are associated (or correlated) with STRAYER EDUCATION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STRAYER EDUCATION has no effect on the direction of FLAT GLASS i.e., FLAT GLASS and STRAYER EDUCATION go up and down completely randomly.

Pair Corralation between FLAT GLASS and STRAYER EDUCATION

Assuming the 90 days horizon FLAT GLASS GROUP is expected to generate 1.11 times more return on investment than STRAYER EDUCATION. However, FLAT GLASS is 1.11 times more volatile than STRAYER EDUCATION. It trades about 0.06 of its potential returns per unit of risk. STRAYER EDUCATION is currently generating about -0.09 per unit of risk. If you would invest  133.00  in FLAT GLASS GROUP on December 21, 2024 and sell it today you would earn a total of  10.00  from holding FLAT GLASS GROUP or generate 7.52% return on investment over 90 days.

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

FLAT GLASS GROUP  vs.  STRAYER EDUCATION

FLAT GLASS GROUP

Risk-Adjusted Performance

Insignificant

Over the last 90 days FLAT GLASS GROUP has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly weak basic indicators, FLAT GLASS may actually be approaching a critical reversion point that can send shares even higher in April 2025.

STRAYER EDUCATION

Risk-Adjusted Performance

Very Weak

Over the last 90 days STRAYER EDUCATION has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with FLAT GLASS and STRAYER EDUCATION

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

The idea behind FLAT GLASS GROUP and STRAYER EDUCATION 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.