Correlation Between Lincoln Educational and FT Cboe
Can any of the company-specific risk be diversified away by investing in both Lincoln Educational and FT Cboe 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 Lincoln Educational and FT Cboe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lincoln Educational Services and FT Cboe Vest, you can compare the effects of market volatilities on Lincoln Educational and FT Cboe 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 Lincoln Educational with a short position of FT Cboe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lincoln Educational and FT Cboe.
Diversification Opportunities for Lincoln Educational and FT Cboe
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Lincoln and KNG is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Lincoln Educational Services and FT Cboe Vest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FT Cboe Vest and Lincoln Educational 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 Lincoln Educational Services are associated (or correlated) with FT Cboe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FT Cboe Vest has no effect on the direction of Lincoln Educational i.e., Lincoln Educational and FT Cboe go up and down completely randomly.
Pair Corralation between Lincoln Educational and FT Cboe
Given the investment horizon of 90 days Lincoln Educational Services is expected to generate 3.87 times more return on investment than FT Cboe. However, Lincoln Educational is 3.87 times more volatile than FT Cboe Vest. It trades about 0.09 of its potential returns per unit of risk. FT Cboe Vest is currently generating about 0.05 per unit of risk. If you would invest 568.00 in Lincoln Educational Services on September 2, 2024 and sell it today you would earn a total of 1,075 from holding Lincoln Educational Services or generate 189.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lincoln Educational Services vs. FT Cboe Vest
Performance |
| Timeline |
| Lincoln Educational |
| FT Cboe Vest |
Lincoln Educational and FT Cboe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lincoln Educational and FT Cboe
The main advantage of trading using opposite Lincoln Educational and FT Cboe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lincoln Educational position performs unexpectedly, FT Cboe 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 FT Cboe will offset losses from the drop in FT Cboe's long position.| Lincoln Educational vs. American Public Education | Lincoln Educational vs. ATA Creativity Global | Lincoln Educational vs. Cogna Educacao SA | Lincoln Educational vs. Adtalem Global Education |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |