Correlation Between SPARTAN STORES and STRAYER EDUCATION
Can any of the company-specific risk be diversified away by investing in both SPARTAN STORES and STRAYER 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 SPARTAN STORES and STRAYER EDUCATION into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SPARTAN STORES and STRAYER EDUCATION, you can compare the effects of market volatilities on SPARTAN STORES and STRAYER 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 SPARTAN STORES with a short position of STRAYER EDUCATION. Check out your portfolio center. Please also check ongoing floating volatility patterns of SPARTAN STORES and STRAYER EDUCATION.
Diversification Opportunities for SPARTAN STORES and STRAYER EDUCATION
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SPARTAN and STRAYER is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding SPARTAN STORES and STRAYER EDUCATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STRAYER EDUCATION and SPARTAN STORES 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 SPARTAN STORES are associated (or correlated) with STRAYER EDUCATION. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STRAYER EDUCATION has no effect on the direction of SPARTAN STORES i.e., SPARTAN STORES and STRAYER EDUCATION go up and down completely randomly.
Pair Corralation between SPARTAN STORES and STRAYER EDUCATION
Assuming the 90 days trading horizon SPARTAN STORES is expected to generate 7.04 times less return on investment than STRAYER EDUCATION. In addition to that, SPARTAN STORES is 1.22 times more volatile than STRAYER EDUCATION. It trades about 0.02 of its total potential returns per unit of risk. STRAYER EDUCATION is currently generating about 0.21 per unit of volatility. If you would invest 8,950 in STRAYER EDUCATION on November 3, 2024 and sell it today you would earn a total of 500.00 from holding STRAYER EDUCATION or generate 5.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SPARTAN STORES vs. STRAYER EDUCATION
Performance |
| Timeline |
| SPARTAN STORES |
| STRAYER EDUCATION |
SPARTAN STORES and STRAYER EDUCATION Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SPARTAN STORES and STRAYER EDUCATION
The main advantage of trading using opposite SPARTAN STORES and STRAYER EDUCATION positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SPARTAN STORES position performs unexpectedly, STRAYER 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 STRAYER EDUCATION will offset losses from the drop in STRAYER EDUCATION's long position.| SPARTAN STORES vs. Park Hotels Resorts | SPARTAN STORES vs. Xenia Hotels Resorts | SPARTAN STORES vs. Dalata Hotel Group | SPARTAN STORES vs. PPHE HOTEL GROUP |
| STRAYER EDUCATION vs. CHEMICAL INDUSTRIES | STRAYER EDUCATION vs. SAFEROADS HLDGS | STRAYER EDUCATION vs. Soken Chemical Engineering | STRAYER EDUCATION vs. Gold Road Resources |
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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