Correlation Between Kelly Services and Trucept
Can any of the company-specific risk be diversified away by investing in both Kelly Services and Trucept 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 Kelly Services and Trucept into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kelly Services A and Trucept, you can compare the effects of market volatilities on Kelly Services and Trucept 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 Kelly Services with a short position of Trucept. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kelly Services and Trucept.
Diversification Opportunities for Kelly Services and Trucept
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kelly and Trucept is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Kelly Services A and Trucept in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trucept and Kelly Services 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 Kelly Services A are associated (or correlated) with Trucept. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trucept has no effect on the direction of Kelly Services i.e., Kelly Services and Trucept go up and down completely randomly.
Pair Corralation between Kelly Services and Trucept
Assuming the 90 days horizon Kelly Services A is expected to under-perform the Trucept. But the stock apears to be less risky and, when comparing its historical volatility, Kelly Services A is 4.71 times less risky than Trucept. The stock trades about -0.05 of its potential returns per unit of risk. The Trucept is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 4.63 in Trucept on August 29, 2024 and sell it today you would lose (1.13) from holding Trucept or give up 24.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kelly Services A vs. Trucept
Performance |
| Timeline |
| Kelly Services A |
| Trucept |
Kelly Services and Trucept Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kelly Services and Trucept
The main advantage of trading using opposite Kelly Services and Trucept positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kelly Services position performs unexpectedly, Trucept 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 Trucept will offset losses from the drop in Trucept's long position.| Kelly Services vs. Korn Ferry | Kelly Services vs. Heidrick Struggles International | Kelly Services vs. Hudson Global | Kelly Services vs. ManpowerGroup |
| Trucept vs. The Caldwell Partners | Trucept vs. Randstad Holdings NV | Trucept vs. Futuris Company | Trucept vs. Hire Technologies |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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