Correlation Between Bright Scholar and AMREP
Can any of the company-specific risk be diversified away by investing in both Bright Scholar and AMREP 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 Bright Scholar and AMREP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bright Scholar Education and AMREP, you can compare the effects of market volatilities on Bright Scholar and AMREP 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 Bright Scholar with a short position of AMREP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bright Scholar and AMREP.
Diversification Opportunities for Bright Scholar and AMREP
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bright and AMREP is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Bright Scholar Education and AMREP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMREP and Bright Scholar 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 Bright Scholar Education are associated (or correlated) with AMREP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMREP has no effect on the direction of Bright Scholar i.e., Bright Scholar and AMREP go up and down completely randomly.
Pair Corralation between Bright Scholar and AMREP
Given the investment horizon of 90 days Bright Scholar is expected to generate 6.19 times less return on investment than AMREP. In addition to that, Bright Scholar is 1.72 times more volatile than AMREP. It trades about 0.01 of its total potential returns per unit of risk. AMREP is currently generating about 0.1 per unit of volatility. If you would invest 1,101 in AMREP on August 30, 2024 and sell it today you would earn a total of 2,439 from holding AMREP or generate 221.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.19% |
| Values | Daily Returns |
Bright Scholar Education vs. AMREP
Performance |
| Timeline |
| Bright Scholar Education |
| AMREP |
Bright Scholar and AMREP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bright Scholar and AMREP
The main advantage of trading using opposite Bright Scholar and AMREP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bright Scholar position performs unexpectedly, AMREP 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 AMREP will offset losses from the drop in AMREP's long position.| Bright Scholar vs. Laureate Education | Bright Scholar vs. China Liberal Education | Bright Scholar vs. Adtalem Global Education | Bright Scholar vs. Grand Canyon Education |
| AMREP vs. Landsea Homes Corp | AMREP vs. Forestar Group | AMREP vs. Five Point Holdings | AMREP vs. American Realty Investors |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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