Correlation Between VSE and ManpowerGroup
Can any of the company-specific risk be diversified away by investing in both VSE and ManpowerGroup 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 VSE and ManpowerGroup into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VSE Corporation and ManpowerGroup, you can compare the effects of market volatilities on VSE and ManpowerGroup 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 VSE with a short position of ManpowerGroup. Check out your portfolio center. Please also check ongoing floating volatility patterns of VSE and ManpowerGroup.
Diversification Opportunities for VSE and ManpowerGroup
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between VSE and ManpowerGroup is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding VSE Corp. and ManpowerGroup in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ManpowerGroup and VSE 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 VSE Corporation are associated (or correlated) with ManpowerGroup. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ManpowerGroup has no effect on the direction of VSE i.e., VSE and ManpowerGroup go up and down completely randomly.
Pair Corralation between VSE and ManpowerGroup
Given the investment horizon of 90 days VSE Corporation is expected to generate 1.59 times more return on investment than ManpowerGroup. However, VSE is 1.59 times more volatile than ManpowerGroup. It trades about 0.19 of its potential returns per unit of risk. ManpowerGroup is currently generating about 0.05 per unit of risk. If you would invest 10,470 in VSE Corporation on August 28, 2024 and sell it today you would earn a total of 1,139 from holding VSE Corporation or generate 10.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VSE Corp. vs. ManpowerGroup
Performance |
| Timeline |
| VSE Corporation |
| ManpowerGroup |
VSE and ManpowerGroup Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VSE and ManpowerGroup
The main advantage of trading using opposite VSE and ManpowerGroup positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VSE position performs unexpectedly, ManpowerGroup 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 ManpowerGroup will offset losses from the drop in ManpowerGroup's long position.| VSE vs. Park Electrochemical | VSE vs. Innovative Solutions and | VSE vs. Curtiss Wright | VSE vs. National Presto Industries |
| ManpowerGroup vs. Kforce Inc | ManpowerGroup vs. Heidrick Struggles International | ManpowerGroup vs. Korn Ferry | ManpowerGroup vs. Hudson Global |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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