Correlation Between Nebius Group and Scholastic

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

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

Diversification Opportunities for Nebius Group and Scholastic

-0.25

Correlation Coefficient

Nebius Group  Scholastic

Very good diversification

The 3 months correlation between Nebius and Scholastic is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Nebius Group NV and Scholastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scholastic and Nebius Group 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 Nebius Group NV are associated (or correlated) with Scholastic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scholastic has no effect on the direction of Nebius Group i.e., Nebius Group and Scholastic go up and down completely randomly.

Pair Corralation between Nebius Group and Scholastic

Given the investment horizon of 90 days Nebius Group NV is expected to generate 1.74 times more return on investment than Scholastic. However, Nebius Group is 1.74 times more volatile than Scholastic. It trades about 0.2 of its potential returns per unit of risk. Scholastic is currently generating about -0.18 per unit of risk. If you would invest  2,143  in Nebius Group NV on September 28, 2024 and sell it today you would earn a total of  663.00  from holding Nebius Group NV or generate 30.94% return on investment over 90 days.

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

Nebius Group NV  vs.  Scholastic

Nebius Group NV

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Nebius Group NV are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak forward indicators, Nebius Group unveiled solid returns over the last few months and may actually be approaching a breakup point.

Scholastic

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Scholastic has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's technical indicators remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Nebius Group and Scholastic

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

The idea behind Nebius Group NV and Scholastic 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.