Correlation Between Bright Scholar and East Africa
Can any of the company-specific risk be diversified away by investing in both Bright Scholar and East Africa 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 East Africa 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 East Africa Metals, you can compare the effects of market volatilities on Bright Scholar and East Africa 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 East Africa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bright Scholar and East Africa.
Diversification Opportunities for Bright Scholar and East Africa
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bright and East is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Bright Scholar Education and East Africa Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East Africa Metals 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 East Africa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East Africa Metals has no effect on the direction of Bright Scholar i.e., Bright Scholar and East Africa go up and down completely randomly.
Pair Corralation between Bright Scholar and East Africa
If you would invest 11.00 in East Africa Metals on September 14, 2024 and sell it today you would earn a total of 0.00 from holding East Africa Metals or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Bright Scholar Education vs. East Africa Metals
Performance |
| Timeline |
| Bright Scholar Education |
| East Africa Metals |
Bright Scholar and East Africa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bright Scholar and East Africa
The main advantage of trading using opposite Bright Scholar and East Africa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bright Scholar position performs unexpectedly, East Africa 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 East Africa will offset losses from the drop in East Africa's long position.| Bright Scholar vs. Laureate Education | Bright Scholar vs. American Public Education | Bright Scholar vs. Lincoln Educational Services | Bright Scholar vs. Adtalem Global Education |
| East Africa vs. Pasinex Resources Limited | East Africa vs. Commander Resources | East Africa vs. Forsys Metals Corp | East Africa vs. American CuMo Mining |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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