Correlation Between Adecco and Heidrick Struggles
Can any of the company-specific risk be diversified away by investing in both Adecco and Heidrick Struggles 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 and Heidrick Struggles into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adecco Group and Heidrick Struggles International, you can compare the effects of market volatilities on Adecco and Heidrick Struggles 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 with a short position of Heidrick Struggles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adecco and Heidrick Struggles.
Diversification Opportunities for Adecco and Heidrick Struggles
-0.93 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Adecco and Heidrick is -0.93. Overlapping area represents the amount of risk that can be diversified away by holding Adecco Group and Heidrick Struggles Internation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heidrick Struggles and Adecco 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 are associated (or correlated) with Heidrick Struggles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heidrick Struggles has no effect on the direction of Adecco i.e., Adecco and Heidrick Struggles go up and down completely randomly.
Pair Corralation between Adecco and Heidrick Struggles
Assuming the 90 days horizon Adecco Group is expected to under-perform the Heidrick Struggles. But the pink sheet apears to be less risky and, when comparing its historical volatility, Adecco Group is 1.31 times less risky than Heidrick Struggles. The pink sheet trades about -0.03 of its potential returns per unit of risk. The Heidrick Struggles International is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2,744 in Heidrick Struggles International on September 12, 2024 and sell it today you would earn a total of 1,820 from holding Heidrick Struggles International or generate 66.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Adecco Group vs. Heidrick Struggles Internation
Performance |
| Timeline |
| Adecco Group |
| Heidrick Struggles |
Adecco and Heidrick Struggles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adecco and Heidrick Struggles
The main advantage of trading using opposite Adecco and Heidrick Struggles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adecco position performs unexpectedly, Heidrick Struggles 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 Heidrick Struggles will offset losses from the drop in Heidrick Struggles' long position.| Adecco vs. ManpowerGroup | Adecco vs. Robert Half International | Adecco vs. Hire Technologies | Adecco vs. The Caldwell Partners |
| Heidrick Struggles vs. Kforce Inc | Heidrick Struggles vs. ManpowerGroup | Heidrick Struggles vs. Korn Ferry | Heidrick Struggles vs. Hudson Global |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |