Correlation Between Stride and 2U
Can any of the company-specific risk be diversified away by investing in both Stride and 2U 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 Stride and 2U into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stride Inc and 2U Inc, you can compare the effects of market volatilities on Stride and 2U 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 Stride with a short position of 2U. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stride and 2U.
Diversification Opportunities for Stride and 2U
Very good diversification
The 3 months correlation between Stride and 2U is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Stride Inc and 2U Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 2U Inc and Stride 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 Stride Inc are associated (or correlated) with 2U. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 2U Inc has no effect on the direction of Stride i.e., Stride and 2U go up and down completely randomly.
Pair Corralation between Stride and 2U
If you would invest 9,101 in Stride Inc on August 28, 2024 and sell it today you would earn a total of 1,506 from holding Stride Inc or generate 16.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Stride Inc vs. 2U Inc
Performance |
| Timeline |
| Stride Inc |
| 2U Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
Stride and 2U Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stride and 2U
The main advantage of trading using opposite Stride and 2U positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stride position performs unexpectedly, 2U 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 2U will offset losses from the drop in 2U's long position.| Stride vs. Laureate Education | Stride vs. American Public Education | Stride vs. Lincoln Educational Services | Stride 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.
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