Correlation Between STI Education and IRemit

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

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

Diversification Opportunities for STI Education and IRemit

0.04

Correlation Coefficient

STI Education  IRemit

Significant diversification

The 3 months correlation between STI and IRemit is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding STI Education Systems and IRemit Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on IRemit Inc and STI Education 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 STI Education Systems are associated (or correlated) with IRemit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of IRemit Inc has no effect on the direction of STI Education i.e., STI Education and IRemit go up and down completely randomly.

Pair Corralation between STI Education and IRemit

Assuming the 90 days trading horizon STI Education is expected to generate 1.56 times less return on investment than IRemit. In addition to that, STI Education is 1.03 times more volatile than IRemit Inc. It trades about 0.36 of its total potential returns per unit of risk. IRemit Inc is currently generating about 0.59 per unit of volatility. If you would invest  23.00  in IRemit Inc on October 11, 2024 and sell it today you would earn a total of  2.00  from holding IRemit Inc or generate 8.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	38.89%
Values	Daily Returns

STI Education Systems  vs.  IRemit Inc

STI Education Systems

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in STI Education Systems are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, STI Education exhibited solid returns over the last few months and may actually be approaching a breakup point.

IRemit Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days IRemit Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in February 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with STI Education and IRemit

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

The idea behind STI Education Systems and IRemit 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.

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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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.