Correlation Between Learning Tree and Ihuman

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

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

Diversification Opportunities for Learning Tree and Ihuman

0.0

Correlation Coefficient

Learning Tree  Ihuman

Pay attention - limited upside

The 3 months correlation between Learning and Ihuman is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Learning Tree International and Ihuman Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ihuman Inc and Learning Tree 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 Learning Tree International are associated (or correlated) with Ihuman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ihuman Inc has no effect on the direction of Learning Tree i.e., Learning Tree and Ihuman go up and down completely randomly.

Pair Corralation between Learning Tree and Ihuman

If you would invest  165.00  in Ihuman Inc on December 28, 2024 and sell it today you would earn a total of  68.00  from holding Ihuman Inc or generate 41.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Learning Tree International  vs.  Ihuman Inc

Learning Tree Intern

Risk-Adjusted Performance

Very Weak

Over the last 90 days Learning Tree International has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Learning Tree is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Ihuman Inc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Ihuman Inc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical indicators, Ihuman demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Learning Tree and Ihuman

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

The idea behind Learning Tree International and Ihuman 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.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.