Correlation Between Acco Brands and Coursera

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

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

Diversification Opportunities for Acco Brands and Coursera

0.27

Correlation Coefficient

Acco Brands  Coursera

Modest diversification

The 3 months correlation between Acco and Coursera is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Acco Brands and Coursera in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coursera and Acco Brands 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 Acco Brands are associated (or correlated) with Coursera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coursera has no effect on the direction of Acco Brands i.e., Acco Brands and Coursera go up and down completely randomly.

Pair Corralation between Acco Brands and Coursera

Given the investment horizon of 90 days Acco Brands is expected to generate 0.6 times more return on investment than Coursera. However, Acco Brands is 1.68 times less risky than Coursera. It trades about 0.03 of its potential returns per unit of risk. Coursera is currently generating about -0.02 per unit of risk. If you would invest  518.00  in Acco Brands on September 12, 2024 and sell it today you would earn a total of  101.00  from holding Acco Brands or generate 19.5% return on investment over 90 days.

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

Acco Brands  vs.  Coursera

Acco Brands

Risk-Adjusted Performance

10 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Acco Brands are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent fundamental indicators, Acco Brands displayed solid returns over the last few months and may actually be approaching a breakup point.

Coursera

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Coursera are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively uncertain basic indicators, Coursera may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Acco Brands and Coursera

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

The idea behind Acco Brands and Coursera 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.

Check out your portfolio center.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.