Correlation Between Nelnet and EZCORP
Can any of the company-specific risk be diversified away by investing in both Nelnet and EZCORP 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 Nelnet and EZCORP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nelnet Inc and EZCORP Inc, you can compare the effects of market volatilities on Nelnet and EZCORP 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 Nelnet with a short position of EZCORP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nelnet and EZCORP.
Diversification Opportunities for Nelnet and EZCORP
Very good diversification
The 3 months correlation between Nelnet and EZCORP is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Nelnet Inc and EZCORP Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EZCORP Inc and Nelnet 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 Nelnet Inc are associated (or correlated) with EZCORP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EZCORP Inc has no effect on the direction of Nelnet i.e., Nelnet and EZCORP go up and down completely randomly.
Pair Corralation between Nelnet and EZCORP
Considering the 90-day investment horizon Nelnet is expected to generate 1.88 times less return on investment than EZCORP. But when comparing it to its historical volatility, Nelnet Inc is 1.13 times less risky than EZCORP. It trades about 0.12 of its potential returns per unit of risk. EZCORP Inc is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,174 in EZCORP Inc on October 20, 2024 and sell it today you would earn a total of 56.00 from holding EZCORP Inc or generate 4.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nelnet Inc vs. EZCORP Inc
Performance |
| Timeline |
| Nelnet Inc |
| EZCORP Inc |
Nelnet and EZCORP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nelnet and EZCORP
The main advantage of trading using opposite Nelnet and EZCORP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nelnet position performs unexpectedly, EZCORP 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 EZCORP will offset losses from the drop in EZCORP's long position.| Nelnet vs. SLM Corp Pb | Nelnet vs. FirstCash | Nelnet vs. Federal Agricultural Mortgage | Nelnet vs. Navient Corp |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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