Correlation Between Cheer Holding and Advantage Solutions
Can any of the company-specific risk be diversified away by investing in both Cheer Holding and Advantage Solutions 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 Cheer Holding and Advantage Solutions into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cheer Holding and Advantage Solutions, you can compare the effects of market volatilities on Cheer Holding and Advantage Solutions 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 Cheer Holding with a short position of Advantage Solutions. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheer Holding and Advantage Solutions.
Diversification Opportunities for Cheer Holding and Advantage Solutions
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cheer and Advantage is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Cheer Holding and Advantage Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Advantage Solutions and Cheer Holding 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 Cheer Holding are associated (or correlated) with Advantage Solutions. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Advantage Solutions has no effect on the direction of Cheer Holding i.e., Cheer Holding and Advantage Solutions go up and down completely randomly.
Pair Corralation between Cheer Holding and Advantage Solutions
Considering the 90-day investment horizon Cheer Holding is expected to under-perform the Advantage Solutions. But the stock apears to be less risky and, when comparing its historical volatility, Cheer Holding is 5.4 times less risky than Advantage Solutions. The stock trades about -0.23 of its potential returns per unit of risk. The Advantage Solutions is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1.03 in Advantage Solutions on August 27, 2025 and sell it today you would lose (0.55) from holding Advantage Solutions or give up 53.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 62.5% |
| Values | Daily Returns |
Cheer Holding vs. Advantage Solutions
Performance |
| Timeline |
| Cheer Holding |
| Advantage Solutions |
Risk-Adjusted Performance
Fair
Weak | Strong |
Cheer Holding and Advantage Solutions Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheer Holding and Advantage Solutions
The main advantage of trading using opposite Cheer Holding and Advantage Solutions positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheer Holding position performs unexpectedly, Advantage Solutions 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 Advantage Solutions will offset losses from the drop in Advantage Solutions' long position.| Cheer Holding vs. Puhui Wealth Investment | Cheer Holding vs. Caribbean Utilities | Cheer Holding vs. Nationwide Utilities | Cheer Holding vs. ScanSource |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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