Correlation Between ACANTHE DEVELOPPEM and STRAYER EDUCATION

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

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

Diversification Opportunities for ACANTHE DEVELOPPEM and STRAYER EDUCATION

-0.44

Correlation Coefficient

ACANTHE DEVELOPPEM  STRAYER EDUCATION

Very good diversification

The 3 months correlation between ACANTHE and STRAYER is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding ACANTHE DEVELOPPEM ON and STRAYER EDUCATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STRAYER EDUCATION and ACANTHE DEVELOPPEM 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 ACANTHE DEVELOPPEM ON 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 ACANTHE DEVELOPPEM i.e., ACANTHE DEVELOPPEM and STRAYER EDUCATION go up and down completely randomly.

Pair Corralation between ACANTHE DEVELOPPEM and STRAYER EDUCATION

Assuming the 90 days horizon ACANTHE DEVELOPPEM ON is expected to under-perform the STRAYER EDUCATION. In addition to that, ACANTHE DEVELOPPEM is 2.09 times more volatile than STRAYER EDUCATION. It trades about -0.01 of its total potential returns per unit of risk. STRAYER EDUCATION is currently generating about 0.12 per unit of volatility. If you would invest  7,949  in STRAYER EDUCATION on October 5, 2024 and sell it today you would earn a total of  1,001  from holding STRAYER EDUCATION or generate 12.59% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.33%
Values	Daily Returns

ACANTHE DEVELOPPEM ON  vs.  STRAYER EDUCATION

ACANTHE DEVELOPPEM

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ACANTHE DEVELOPPEM ON has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, ACANTHE DEVELOPPEM is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

STRAYER EDUCATION

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days STRAYER EDUCATION has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather uncertain technical and fundamental indicators, STRAYER EDUCATION exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ACANTHE DEVELOPPEM and STRAYER EDUCATION

The main advantage of trading using opposite ACANTHE DEVELOPPEM and STRAYER EDUCATION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACANTHE DEVELOPPEM 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 ACANTHE DEVELOPPEM ON 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.