Correlation Between Fastly and TAL Education

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

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

Diversification Opportunities for Fastly and TAL Education

0.05

Correlation Coefficient

Fastly  TAL Education

Significant diversification

The 3 months correlation between Fastly and TAL is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Fastly Inc and TAL Education Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TAL Education Group and Fastly 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 Fastly Inc are associated (or correlated) with TAL Education. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TAL Education Group has no effect on the direction of Fastly i.e., Fastly and TAL Education go up and down completely randomly.

Pair Corralation between Fastly and TAL Education

Given the investment horizon of 90 days Fastly Inc is expected to under-perform the TAL Education. In addition to that, Fastly is 1.39 times more volatile than TAL Education Group. It trades about -0.05 of its total potential returns per unit of risk. TAL Education Group is currently generating about 0.1 per unit of volatility. If you would invest  1,001  in TAL Education Group on May 13, 2025 and sell it today you would earn a total of  144.00  from holding TAL Education Group or generate 14.39% return on investment over 90 days.

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

Fastly Inc  vs.  TAL Education Group

Fastly Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days Fastly Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's essential indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

TAL Education Group

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in TAL Education Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite uncertain basic indicators, TAL Education disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Fastly and TAL Education

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

The idea behind Fastly Inc and TAL 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.

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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.