Correlation Between Afya and XChange TECINC
Can any of the company-specific risk be diversified away by investing in both Afya and XChange TECINC 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 XChange TECINC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Afya and XChange TECINC, you can compare the effects of market volatilities on Afya and XChange TECINC 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 XChange TECINC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Afya and XChange TECINC.
Diversification Opportunities for Afya and XChange TECINC
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Afya and XChange is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Afya and XChange TECINC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XChange TECINC 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 XChange TECINC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XChange TECINC has no effect on the direction of Afya i.e., Afya and XChange TECINC go up and down completely randomly.
Pair Corralation between Afya and XChange TECINC
Given the investment horizon of 90 days Afya is expected to generate 0.1 times more return on investment than XChange TECINC. However, Afya is 9.63 times less risky than XChange TECINC. It trades about 0.0 of its potential returns per unit of risk. XChange TECINC is currently generating about -0.08 per unit of risk. If you would invest 1,680 in Afya on September 4, 2024 and sell it today you would lose (21.00) from holding Afya or give up 1.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Afya vs. XChange TECINC
Performance |
| Timeline |
| Afya |
| XChange TECINC |
Afya and XChange TECINC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Afya and XChange TECINC
The main advantage of trading using opposite Afya and XChange TECINC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Afya position performs unexpectedly, XChange TECINC 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 XChange TECINC will offset losses from the drop in XChange TECINC's long position.| Afya vs. Laureate Education | Afya vs. Lincoln Educational Services | Afya vs. Adtalem Global Education | Afya vs. Strategic Education |
| XChange TECINC vs. Relx PLC ADR | XChange TECINC vs. Sealed Air | XChange TECINC vs. Afya | XChange TECINC vs. Skillful Craftsman Education |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |