Correlation Between Graham Holdings and Hailiang Education

Can any of the company-specific risk be diversified away by investing in both Graham Holdings and Hailiang 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 Graham Holdings and Hailiang Education into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Graham Holdings Co and Hailiang Education Group, you can compare the effects of market volatilities on Graham Holdings and Hailiang 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 Graham Holdings with a short position of Hailiang Education. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graham Holdings and Hailiang Education.

Diversification Opportunities for Graham Holdings and Hailiang Education

0.0

Correlation Coefficient

Graham Holdings  Hailiang Education

Pay attention - limited upside

The 3 months correlation between Graham and Hailiang is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Graham Holdings Co and Hailiang Education Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hailiang Education and Graham Holdings 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 Graham Holdings Co are associated (or correlated) with Hailiang Education. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hailiang Education has no effect on the direction of Graham Holdings i.e., Graham Holdings and Hailiang Education go up and down completely randomly.

Pair Corralation between Graham Holdings and Hailiang Education

If you would invest (100.00) in Hailiang Education Group on January 24, 2024 and sell it today you would earn a total of  100.00  from holding Hailiang Education Group or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Graham Holdings Co  vs.  Hailiang Education Group

Graham Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Graham Holdings Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical indicators, Graham Holdings is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Hailiang Education

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hailiang Education Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, Hailiang Education is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Graham Holdings and Hailiang Education

The main advantage of trading using opposite Graham Holdings and Hailiang Education positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graham Holdings position performs unexpectedly, Hailiang 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 Hailiang Education will offset losses from the drop in Hailiang Education's long position.

The idea behind Graham Holdings Co and Hailiang Education Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 CEOs Directory module to screen CEOs from public companies around the world.