Correlation Between Adtalem Global and CSW Industrials,

Can any of the company-specific risk be diversified away by investing in both Adtalem Global and CSW Industrials, 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 Adtalem Global and CSW Industrials, into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Adtalem Global Education and CSW Industrials,, you can compare the effects of market volatilities on Adtalem Global and CSW Industrials, 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 Adtalem Global with a short position of CSW Industrials,. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adtalem Global and CSW Industrials,.

Diversification Opportunities for Adtalem Global and CSW Industrials,

0.6

Correlation Coefficient

Adtalem Global  CSW Industrials,

Poor diversification

The 3 months correlation between Adtalem and CSW is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Adtalem Global Education and CSW Industrials, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSW Industrials, and Adtalem Global 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 Adtalem Global Education are associated (or correlated) with CSW Industrials,. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSW Industrials, has no effect on the direction of Adtalem Global i.e., Adtalem Global and CSW Industrials, go up and down completely randomly.

Pair Corralation between Adtalem Global and CSW Industrials,

Given the investment horizon of 90 days Adtalem Global Education is expected to generate 0.8 times more return on investment than CSW Industrials,. However, Adtalem Global Education is 1.24 times less risky than CSW Industrials,. It trades about -0.07 of its potential returns per unit of risk. CSW Industrials, is currently generating about -0.17 per unit of risk. If you would invest  13,189  in Adtalem Global Education on May 12, 2025 and sell it today you would lose (1,005) from holding Adtalem Global Education or give up 7.62% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Adtalem Global Education  vs.  CSW Industrials,

Adtalem Global Education

Risk-Adjusted Performance

Weakest

Over the last 90 days Adtalem Global Education has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest inconsistent performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

CSW Industrials,

Risk-Adjusted Performance

Weakest

Over the last 90 days CSW Industrials, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in September 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Adtalem Global and CSW Industrials,

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

The idea behind Adtalem Global Education and CSW Industrials, 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.

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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.