Correlation Between Laureate Education and COMINTL BANK
Can any of the company-specific risk be diversified away by investing in both Laureate Education and COMINTL BANK 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 Laureate Education and COMINTL BANK into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Laureate Education and COMINTL BANK ADR1, you can compare the effects of market volatilities on Laureate Education and COMINTL BANK 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 Laureate Education with a short position of COMINTL BANK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Laureate Education and COMINTL BANK.
Diversification Opportunities for Laureate Education and COMINTL BANK
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Laureate and COMINTL is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Laureate Education and COMINTL BANK ADR1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COMINTL BANK ADR1 and Laureate Education 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 Laureate Education are associated (or correlated) with COMINTL BANK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COMINTL BANK ADR1 has no effect on the direction of Laureate Education i.e., Laureate Education and COMINTL BANK go up and down completely randomly.
Pair Corralation between Laureate Education and COMINTL BANK
Assuming the 90 days trading horizon Laureate Education is expected to generate 1.4 times more return on investment than COMINTL BANK. However, Laureate Education is 1.4 times more volatile than COMINTL BANK ADR1. It trades about 0.29 of its potential returns per unit of risk. COMINTL BANK ADR1 is currently generating about 0.07 per unit of risk. If you would invest 1,440 in Laureate Education on August 25, 2024 and sell it today you would earn a total of 350.00 from holding Laureate Education or generate 24.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Laureate Education vs. COMINTL BANK ADR1
Performance |
| Timeline |
| Laureate Education |
| COMINTL BANK ADR1 |
Laureate Education and COMINTL BANK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Laureate Education and COMINTL BANK
The main advantage of trading using opposite Laureate Education and COMINTL BANK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Laureate Education position performs unexpectedly, COMINTL BANK 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 COMINTL BANK will offset losses from the drop in COMINTL BANK's long position.| Laureate Education vs. G III APPAREL GROUP | Laureate Education vs. CSSC Offshore Marine | Laureate Education vs. Solstad Offshore ASA | Laureate Education vs. Warner Music Group |
| COMINTL BANK vs. Superior Plus Corp | COMINTL BANK vs. NMI Holdings | COMINTL BANK vs. Origin Agritech | COMINTL BANK vs. SIVERS SEMICONDUCTORS AB |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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