Correlation Between Universal Technical and ATA Creativity
Can any of the company-specific risk be diversified away by investing in both Universal Technical and ATA Creativity 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 Universal Technical and ATA Creativity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Universal Technical Institute and ATA Creativity Global, you can compare the effects of market volatilities on Universal Technical and ATA Creativity 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 Universal Technical with a short position of ATA Creativity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Technical and ATA Creativity.
Diversification Opportunities for Universal Technical and ATA Creativity
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Universal and ATA is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Universal Technical Institute and ATA Creativity Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATA Creativity Global and Universal Technical 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 Universal Technical Institute are associated (or correlated) with ATA Creativity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATA Creativity Global has no effect on the direction of Universal Technical i.e., Universal Technical and ATA Creativity go up and down completely randomly.
Pair Corralation between Universal Technical and ATA Creativity
Considering the 90-day investment horizon Universal Technical Institute is expected to generate 0.51 times more return on investment than ATA Creativity. However, Universal Technical Institute is 1.97 times less risky than ATA Creativity. It trades about 0.27 of its potential returns per unit of risk. ATA Creativity Global is currently generating about -0.13 per unit of risk. If you would invest 2,577 in Universal Technical Institute on November 7, 2024 and sell it today you would earn a total of 318.00 from holding Universal Technical Institute or generate 12.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Universal Technical Institute vs. ATA Creativity Global
Performance |
| Timeline |
| Universal Technical |
| ATA Creativity Global |
Universal Technical and ATA Creativity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Universal Technical and ATA Creativity
The main advantage of trading using opposite Universal Technical and ATA Creativity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Universal Technical position performs unexpectedly, ATA Creativity 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 ATA Creativity will offset losses from the drop in ATA Creativity's long position.| Universal Technical vs. Laureate Education | Universal Technical vs. Strategic Education | Universal Technical vs. Grand Canyon Education | Universal Technical vs. American Public Education |
| ATA Creativity vs. Laureate Education | ATA Creativity vs. American Public Education | ATA Creativity vs. Lincoln Educational Services | ATA Creativity vs. Adtalem Global 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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