Correlation Between Afya and Golden Sun
Can any of the company-specific risk be diversified away by investing in both Afya and Golden Sun 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 Golden Sun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Afya and Golden Sun Education, you can compare the effects of market volatilities on Afya and Golden Sun 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 Golden Sun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Afya and Golden Sun.
Diversification Opportunities for Afya and Golden Sun
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Afya and Golden is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Afya and Golden Sun Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Sun Education 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 Golden Sun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Sun Education has no effect on the direction of Afya i.e., Afya and Golden Sun go up and down completely randomly.
Pair Corralation between Afya and Golden Sun
Given the investment horizon of 90 days Afya is expected to generate 2.67 times less return on investment than Golden Sun. But when comparing it to its historical volatility, Afya is 4.41 times less risky than Golden Sun. It trades about 0.02 of its potential returns per unit of risk. Golden Sun Education is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,360 in Golden Sun Education on August 24, 2024 and sell it today you would lose (1,077) from holding Golden Sun Education or give up 79.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Afya vs. Golden Sun Education
Performance |
| Timeline |
| Afya |
| Golden Sun Education |
Afya and Golden Sun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Afya and Golden Sun
The main advantage of trading using opposite Afya and Golden Sun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Afya position performs unexpectedly, Golden Sun 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 Golden Sun will offset losses from the drop in Golden Sun's long position.| Afya vs. Adtalem Global Education | Afya vs. Laureate Education | Afya vs. American Public Education | Afya vs. Strategic Education |
| Golden Sun vs. TAL Education Group | Golden Sun vs. Strategic Education | Golden Sun vs. Vasta Platform | Golden Sun vs. Afya |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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