Correlation Between Bright Scholar and PS International
Can any of the company-specific risk be diversified away by investing in both Bright Scholar and PS International 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 PS International 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 PS International Group, you can compare the effects of market volatilities on Bright Scholar and PS International 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 PS International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bright Scholar and PS International.
Diversification Opportunities for Bright Scholar and PS International
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bright and PSIG is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Bright Scholar Education and PS International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PS International 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 PS International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PS International has no effect on the direction of Bright Scholar i.e., Bright Scholar and PS International go up and down completely randomly.
Pair Corralation between Bright Scholar and PS International
Given the investment horizon of 90 days Bright Scholar Education is expected to generate 0.3 times more return on investment than PS International. However, Bright Scholar Education is 3.37 times less risky than PS International. It trades about -0.02 of its potential returns per unit of risk. PS International Group is currently generating about -0.05 per unit of risk. If you would invest 223.00 in Bright Scholar Education on September 3, 2024 and sell it today you would lose (48.00) from holding Bright Scholar Education or give up 21.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 78.51% |
| Values | Daily Returns |
Bright Scholar Education vs. PS International Group
Performance |
| Timeline |
| Bright Scholar Education |
| PS International |
Bright Scholar and PS International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bright Scholar and PS International
The main advantage of trading using opposite Bright Scholar and PS International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bright Scholar position performs unexpectedly, PS International 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 PS International will offset losses from the drop in PS International'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 |
| PS International vs. AmTrust Financial Services | PS International vs. Encore Capital Group | PS International vs. Mill City Ventures | PS International vs. KeyCorp |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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