Correlation Between Adecco Group and STHREE PLC
Can any of the company-specific risk be diversified away by investing in both Adecco Group and STHREE PLC 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 Adecco Group and STHREE PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adecco Group AG and STHREE PLC LS, you can compare the effects of market volatilities on Adecco Group and STHREE PLC 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 Adecco Group with a short position of STHREE PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adecco Group and STHREE PLC.
Diversification Opportunities for Adecco Group and STHREE PLC
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Adecco and STHREE is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Adecco Group AG and STHREE PLC LS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STHREE PLC LS and Adecco 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 Adecco Group AG are associated (or correlated) with STHREE PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STHREE PLC LS has no effect on the direction of Adecco Group i.e., Adecco Group and STHREE PLC go up and down completely randomly.
Pair Corralation between Adecco Group and STHREE PLC
Assuming the 90 days trading horizon Adecco Group AG is expected to under-perform the STHREE PLC. In addition to that, Adecco Group is 2.79 times more volatile than STHREE PLC LS. It trades about -0.01 of its total potential returns per unit of risk. STHREE PLC LS is currently generating about 0.09 per unit of volatility. If you would invest 423.00 in STHREE PLC LS on September 13, 2024 and sell it today you would earn a total of 9.00 from holding STHREE PLC LS or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Adecco Group AG vs. STHREE PLC LS
Performance |
| Timeline |
| Adecco Group AG |
| STHREE PLC LS |
Adecco Group and STHREE PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adecco Group and STHREE PLC
The main advantage of trading using opposite Adecco Group and STHREE PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adecco Group position performs unexpectedly, STHREE PLC 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 STHREE PLC will offset losses from the drop in STHREE PLC's long position.| Adecco Group vs. Recruit Holdings Co | Adecco Group vs. Randstad NV | Adecco Group vs. Superior Plus Corp | Adecco Group vs. Origin Agritech |
| STHREE PLC vs. PREMIER FOODS | STHREE PLC vs. National Beverage Corp | STHREE PLC vs. Tyson Foods | STHREE PLC vs. WisdomTree Investments |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |