Correlation Between Cass Information and Kelly Services
Can any of the company-specific risk be diversified away by investing in both Cass Information and Kelly Services 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 Cass Information and Kelly Services into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cass Information Systems and Kelly Services A, you can compare the effects of market volatilities on Cass Information and Kelly Services 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 Cass Information with a short position of Kelly Services. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cass Information and Kelly Services.
Diversification Opportunities for Cass Information and Kelly Services
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cass and Kelly is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Cass Information Systems and Kelly Services A in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kelly Services A and Cass Information 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 Cass Information Systems are associated (or correlated) with Kelly Services. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kelly Services A has no effect on the direction of Cass Information i.e., Cass Information and Kelly Services go up and down completely randomly.
Pair Corralation between Cass Information and Kelly Services
Given the investment horizon of 90 days Cass Information Systems is expected to generate 0.5 times more return on investment than Kelly Services. However, Cass Information Systems is 2.0 times less risky than Kelly Services. It trades about -0.12 of its potential returns per unit of risk. Kelly Services A is currently generating about -0.24 per unit of risk. If you would invest 4,582 in Cass Information Systems on September 12, 2024 and sell it today you would lose (117.00) from holding Cass Information Systems or give up 2.55% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Cass Information Systems vs. Kelly Services A
Performance |
Timeline |
Cass Information Systems |
Kelly Services A |
Cass Information and Kelly Services Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Cass Information and Kelly Services
The main advantage of trading using opposite Cass Information and Kelly Services positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cass Information position performs unexpectedly, Kelly Services 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 Kelly Services will offset losses from the drop in Kelly Services' long position.Cass Information vs. First Advantage Corp | Cass Information vs. Rentokil Initial PLC | Cass Information vs. CBIZ Inc | Cass Information vs. Civeo Corp |
Kelly Services vs. Korn Ferry | Kelly Services vs. Heidrick Struggles International | Kelly Services vs. Hudson Global | Kelly Services vs. ManpowerGroup |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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