Correlation Between Hope Education and XTANT MEDICAL

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

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

Diversification Opportunities for Hope Education and XTANT MEDICAL

0.76

Correlation Coefficient

Hope Education  XTANT MEDICAL

Poor diversification

The 3 months correlation between Hope and XTANT is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Hope Education Group and XTANT MEDICAL HLDGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XTANT MEDICAL HLDGS and Hope Education 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 Hope Education Group are associated (or correlated) with XTANT MEDICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XTANT MEDICAL HLDGS has no effect on the direction of Hope Education i.e., Hope Education and XTANT MEDICAL go up and down completely randomly.

Pair Corralation between Hope Education and XTANT MEDICAL

Assuming the 90 days horizon Hope Education Group is expected to generate 0.97 times more return on investment than XTANT MEDICAL. However, Hope Education Group is 1.03 times less risky than XTANT MEDICAL. It trades about 0.2 of its potential returns per unit of risk. XTANT MEDICAL HLDGS is currently generating about 0.13 per unit of risk. If you would invest  1.05  in Hope Education Group on April 24, 2025 and sell it today you would earn a total of  0.65  from holding Hope Education Group or generate 61.9% return on investment over 90 days.

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

Hope Education Group  vs.  XTANT MEDICAL HLDGS

Hope Education Group

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hope Education Group are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Hope Education reported solid returns over the last few months and may actually be approaching a breakup point.

XTANT MEDICAL HLDGS

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in XTANT MEDICAL HLDGS are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, XTANT MEDICAL reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Hope Education and XTANT MEDICAL

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

The idea behind Hope Education Group and XTANT MEDICAL HLDGS 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.