Correlation Between STRAYER EDUCATION and Nokia
Can any of the company-specific risk be diversified away by investing in both STRAYER EDUCATION and Nokia 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 STRAYER EDUCATION and Nokia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STRAYER EDUCATION and Nokia, you can compare the effects of market volatilities on STRAYER EDUCATION and Nokia 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 STRAYER EDUCATION with a short position of Nokia. Check out your portfolio center. Please also check ongoing floating volatility patterns of STRAYER EDUCATION and Nokia.
Diversification Opportunities for STRAYER EDUCATION and Nokia
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between STRAYER and Nokia is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding STRAYER EDUCATION and Nokia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nokia and STRAYER EDUCATION 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 STRAYER EDUCATION are associated (or correlated) with Nokia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nokia has no effect on the direction of STRAYER EDUCATION i.e., STRAYER EDUCATION and Nokia go up and down completely randomly.
Pair Corralation between STRAYER EDUCATION and Nokia
Assuming the 90 days trading horizon STRAYER EDUCATION is expected to generate 1.51 times more return on investment than Nokia. However, STRAYER EDUCATION is 1.51 times more volatile than Nokia. It trades about 0.33 of its potential returns per unit of risk. Nokia is currently generating about -0.24 per unit of risk. If you would invest 8,050 in STRAYER EDUCATION on September 1, 2024 and sell it today you would earn a total of 1,350 from holding STRAYER EDUCATION or generate 16.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
STRAYER EDUCATION vs. Nokia
Performance |
| Timeline |
| STRAYER EDUCATION |
| Nokia |
STRAYER EDUCATION and Nokia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STRAYER EDUCATION and Nokia
The main advantage of trading using opposite STRAYER EDUCATION and Nokia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STRAYER EDUCATION position performs unexpectedly, Nokia 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 Nokia will offset losses from the drop in Nokia's long position.| STRAYER EDUCATION vs. SIVERS SEMICONDUCTORS AB | STRAYER EDUCATION vs. Darden Restaurants | STRAYER EDUCATION vs. Reliance Steel Aluminum | STRAYER EDUCATION vs. Q2M Managementberatung AG |
| Nokia vs. STRAYER EDUCATION | Nokia vs. CAREER EDUCATION | Nokia vs. MYFAIR GOLD P | Nokia 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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