Correlation Between Afya and Coursera
Can any of the company-specific risk be diversified away by investing in both Afya and Coursera 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 Afya and Coursera into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Afya and Coursera, you can compare the effects of market volatilities on Afya and Coursera 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 Afya with a short position of Coursera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Afya and Coursera.
Diversification Opportunities for Afya and Coursera
Average diversification
The 3 months correlation between Afya and Coursera is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Afya and Coursera in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coursera and Afya 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 Afya are associated (or correlated) with Coursera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coursera has no effect on the direction of Afya i.e., Afya and Coursera go up and down completely randomly.
Pair Corralation between Afya and Coursera
Given the investment horizon of 90 days Afya is expected to generate 0.68 times more return on investment than Coursera. However, Afya is 1.48 times less risky than Coursera. It trades about 0.02 of its potential returns per unit of risk. Coursera is currently generating about -0.02 per unit of risk. If you would invest 1,460 in Afya on August 24, 2024 and sell it today you would earn a total of 214.00 from holding Afya or generate 14.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Afya vs. Coursera
Performance |
| Timeline |
| Afya |
| Coursera |
Afya and Coursera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Afya and Coursera
The main advantage of trading using opposite Afya and Coursera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Afya position performs unexpectedly, Coursera 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 Coursera will offset losses from the drop in Coursera's long position.| Afya vs. Adtalem Global Education | Afya vs. Laureate Education | Afya vs. American Public Education | Afya vs. Strategic Education |
| Coursera vs. Chegg Inc | Coursera vs. Skillsoft Corp | Coursera vs. Laureate Education | Coursera vs. Udemy Inc |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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