Correlation Between Curo Group and Adtalem Global

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Can any of the company-specific risk be diversified away by investing in both Curo Group and Adtalem Global 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 Curo Group and Adtalem Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Curo Group Holdings and Adtalem Global Education, you can compare the effects of market volatilities on Curo Group and Adtalem Global 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 Curo Group with a short position of Adtalem Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Curo Group and Adtalem Global.

Diversification Opportunities for Curo Group and Adtalem Global

0.02
  Correlation Coefficient

Significant diversification

The 3 months correlation between Curo and Adtalem is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Curo Group Holdings and Adtalem Global Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adtalem Global Education and Curo 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 Curo Group Holdings are associated (or correlated) with Adtalem Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adtalem Global Education has no effect on the direction of Curo Group i.e., Curo Group and Adtalem Global go up and down completely randomly.

Pair Corralation between Curo Group and Adtalem Global

Given the investment horizon of 90 days Curo Group Holdings is expected to under-perform the Adtalem Global. In addition to that, Curo Group is 2.81 times more volatile than Adtalem Global Education. It trades about -0.04 of its total potential returns per unit of risk. Adtalem Global Education is currently generating about 0.08 per unit of volatility. If you would invest  3,895  in Adtalem Global Education on August 28, 2024 and sell it today you would earn a total of  5,262  from holding Adtalem Global Education or generate 135.1% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy31.72%
ValuesDaily Returns

Curo Group Holdings  vs.  Adtalem Global Education

 Performance 
       Timeline  
Curo Group Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Curo Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Curo Group is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.
Adtalem Global Education 

Risk-Adjusted Performance

11 of 100

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

Curo Group and Adtalem Global Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Curo Group and Adtalem Global

The main advantage of trading using opposite Curo Group and Adtalem Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Curo Group position performs unexpectedly, Adtalem Global 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 Adtalem Global will offset losses from the drop in Adtalem Global's long position.
The idea behind Curo Group Holdings and Adtalem Global Education 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

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