Correlation Between VIAPLAY GROUP and Chegg

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

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

Diversification Opportunities for VIAPLAY GROUP and Chegg

0.09

Correlation Coefficient

VIAPLAY GROUP  Chegg

Significant diversification

The 3 months correlation between VIAPLAY and Chegg is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding VIAPLAY GROUP AB and Chegg Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chegg Inc and VIAPLAY GROUP 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 VIAPLAY GROUP AB are associated (or correlated) with Chegg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chegg Inc has no effect on the direction of VIAPLAY GROUP i.e., VIAPLAY GROUP and Chegg go up and down completely randomly.

Pair Corralation between VIAPLAY GROUP and Chegg

Assuming the 90 days horizon VIAPLAY GROUP AB is expected to under-perform the Chegg. But the stock apears to be less risky and, when comparing its historical volatility, VIAPLAY GROUP AB is 1.32 times less risky than Chegg. The stock trades about -0.04 of its potential returns per unit of risk. The Chegg Inc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  187.00  in Chegg Inc on September 3, 2024 and sell it today you would earn a total of  30.00  from holding Chegg Inc or generate 16.04% return on investment over 90 days.

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

VIAPLAY GROUP AB  vs.  Chegg Inc

VIAPLAY GROUP AB

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VIAPLAY GROUP AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Chegg Inc

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Chegg Inc are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Chegg reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VIAPLAY GROUP and Chegg

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

The idea behind VIAPLAY GROUP AB and Chegg Inc 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.