Correlation Between ManpowerGroup and Cross Country
Can any of the company-specific risk be diversified away by investing in both ManpowerGroup and Cross Country 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 ManpowerGroup and Cross Country into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ManpowerGroup and Cross Country Healthcare, you can compare the effects of market volatilities on ManpowerGroup and Cross Country 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 ManpowerGroup with a short position of Cross Country. Check out your portfolio center. Please also check ongoing floating volatility patterns of ManpowerGroup and Cross Country.
Diversification Opportunities for ManpowerGroup and Cross Country
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ManpowerGroup and Cross is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding ManpowerGroup and Cross Country Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cross Country Healthcare and ManpowerGroup 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 ManpowerGroup are associated (or correlated) with Cross Country. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cross Country Healthcare has no effect on the direction of ManpowerGroup i.e., ManpowerGroup and Cross Country go up and down completely randomly.
Pair Corralation between ManpowerGroup and Cross Country
Assuming the 90 days horizon ManpowerGroup is expected to generate 0.54 times more return on investment than Cross Country. However, ManpowerGroup is 1.86 times less risky than Cross Country. It trades about -0.02 of its potential returns per unit of risk. Cross Country Healthcare is currently generating about -0.05 per unit of risk. If you would invest 7,573 in ManpowerGroup on September 2, 2024 and sell it today you would lose (1,473) from holding ManpowerGroup or give up 19.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ManpowerGroup vs. Cross Country Healthcare
Performance |
| Timeline |
| ManpowerGroup |
| Cross Country Healthcare |
ManpowerGroup and Cross Country Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ManpowerGroup and Cross Country
The main advantage of trading using opposite ManpowerGroup and Cross Country positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ManpowerGroup position performs unexpectedly, Cross Country 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 Cross Country will offset losses from the drop in Cross Country's long position.| ManpowerGroup vs. CDN IMPERIAL BANK | ManpowerGroup vs. Webster Financial | ManpowerGroup vs. JSC Halyk bank | ManpowerGroup vs. Regions Financial |
| Cross Country vs. SMA Solar Technology | Cross Country vs. Align Technology | Cross Country vs. Micron Technology | Cross Country vs. Transportadora de Gas |
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.
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