Correlation Between TAL Education and Ihuman
Can any of the company-specific risk be diversified away by investing in both TAL Education and Ihuman 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 TAL Education and Ihuman into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TAL Education Group and Ihuman Inc, you can compare the effects of market volatilities on TAL Education and Ihuman 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 TAL Education with a short position of Ihuman. Check out your portfolio center. Please also check ongoing floating volatility patterns of TAL Education and Ihuman.
Diversification Opportunities for TAL Education and Ihuman
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between TAL and Ihuman is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding TAL Education Group and Ihuman Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ihuman Inc and TAL 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 TAL Education Group are associated (or correlated) with Ihuman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ihuman Inc has no effect on the direction of TAL Education i.e., TAL Education and Ihuman go up and down completely randomly.
Pair Corralation between TAL Education and Ihuman
Considering the 90-day investment horizon TAL Education Group is expected to generate 1.14 times more return on investment than Ihuman. However, TAL Education is 1.14 times more volatile than Ihuman Inc. It trades about 0.05 of its potential returns per unit of risk. Ihuman Inc is currently generating about -0.02 per unit of risk. If you would invest 628.00 in TAL Education Group on August 31, 2024 and sell it today you would earn a total of 365.00 from holding TAL Education Group or generate 58.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TAL Education Group vs. Ihuman Inc
Performance |
| Timeline |
| TAL Education Group |
| Ihuman Inc |
TAL Education and Ihuman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TAL Education and Ihuman
The main advantage of trading using opposite TAL Education and Ihuman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TAL Education position performs unexpectedly, Ihuman 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 Ihuman will offset losses from the drop in Ihuman's long position.| TAL Education vs. Gaotu Techedu DRC | TAL Education vs. 17 Education Technology | TAL Education vs. Chegg Inc | TAL Education vs. Youdao Inc |
| Ihuman vs. Boqii Holding Limited | Ihuman vs. Lixiang Education Holding | Ihuman vs. Huize Holding | Ihuman vs. Kuke Music Holding |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Stocks Directory Find actively traded stocks across global markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |