Correlation Between Lincoln Educational and Perdoceo Education
Can any of the company-specific risk be diversified away by investing in both Lincoln Educational and Perdoceo 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 Lincoln Educational and Perdoceo Education 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 Perdoceo Education Corp, you can compare the effects of market volatilities on Lincoln Educational and Perdoceo 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 Lincoln Educational with a short position of Perdoceo Education. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lincoln Educational and Perdoceo Education.
Diversification Opportunities for Lincoln Educational and Perdoceo Education
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Lincoln and Perdoceo is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Lincoln Educational Services and Perdoceo Education Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perdoceo Education Corp 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 Perdoceo Education. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perdoceo Education Corp has no effect on the direction of Lincoln Educational i.e., Lincoln Educational and Perdoceo Education go up and down completely randomly.
Pair Corralation between Lincoln Educational and Perdoceo Education
Given the investment horizon of 90 days Lincoln Educational Services is expected to generate 1.05 times more return on investment than Perdoceo Education. However, Lincoln Educational is 1.05 times more volatile than Perdoceo Education Corp. It trades about 0.17 of its potential returns per unit of risk. Perdoceo Education Corp is currently generating about 0.16 per unit of risk. If you would invest 1,163 in Lincoln Educational Services on November 1, 2024 and sell it today you would earn a total of 430.00 from holding Lincoln Educational Services or generate 36.97% 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. Perdoceo Education Corp
Performance |
| Timeline |
| Lincoln Educational |
| Perdoceo Education Corp |
Lincoln Educational and Perdoceo Education Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lincoln Educational and Perdoceo Education
The main advantage of trading using opposite Lincoln Educational and Perdoceo Education positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lincoln Educational position performs unexpectedly, Perdoceo 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 Perdoceo Education will offset losses from the drop in Perdoceo Education's long position.| Lincoln Educational vs. Lixiang Education Holding | Lincoln Educational vs. Four Seasons Education | Lincoln Educational vs. Jianzhi Education Technology | Lincoln Educational vs. Elite Education Group |
| Perdoceo Education vs. Lincoln Educational Services | Perdoceo Education vs. Adtalem Global Education | Perdoceo Education vs. Grand Canyon Education | Perdoceo Education vs. Strategic 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |