Correlation Between Ihuman and Elite Education
Can any of the company-specific risk be diversified away by investing in both Ihuman and Elite Education 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 Ihuman and Elite Education into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ihuman Inc and Elite Education Group, you can compare the effects of market volatilities on Ihuman and Elite Education 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 Ihuman with a short position of Elite Education. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ihuman and Elite Education.
Diversification Opportunities for Ihuman and Elite Education
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ihuman and Elite is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ihuman Inc and Elite Education Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elite Education Group and Ihuman 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 Ihuman Inc are associated (or correlated) with Elite Education. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elite Education Group has no effect on the direction of Ihuman i.e., Ihuman and Elite Education go up and down completely randomly.
Pair Corralation between Ihuman and Elite Education
Allowing for the 90-day total investment horizon Ihuman Inc is expected to under-perform the Elite Education. But the stock apears to be less risky and, when comparing its historical volatility, Ihuman Inc is 1.73 times less risky than Elite Education. The stock trades about -0.14 of its potential returns per unit of risk. The Elite Education Group is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 81.00 in Elite Education Group on September 3, 2024 and sell it today you would earn a total of 23.00 from holding Elite Education Group or generate 28.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ihuman Inc vs. Elite Education Group
Performance |
| Timeline |
| Ihuman Inc |
| Elite Education Group |
Ihuman and Elite Education Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ihuman and Elite Education
The main advantage of trading using opposite Ihuman and Elite Education positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ihuman position performs unexpectedly, Elite Education 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 Elite Education will offset losses from the drop in Elite Education's long position.| Ihuman vs. Boqii Holding Limited | Ihuman vs. Lixiang Education Holding | Ihuman vs. Huize Holding | Ihuman vs. Kuke Music Holding |
| Elite Education vs. Golden Sun Education | Elite Education vs. Jianzhi Education Technology | Elite Education vs. Genius Group | Elite Education vs. Lixiang Education Holding |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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