Correlation Between Cogna Educacao and Grand Canyon
Can any of the company-specific risk be diversified away by investing in both Cogna Educacao and Grand Canyon 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 Cogna Educacao and Grand Canyon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cogna Educacao SA and Grand Canyon Education, you can compare the effects of market volatilities on Cogna Educacao and Grand Canyon 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 Cogna Educacao with a short position of Grand Canyon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cogna Educacao and Grand Canyon.
Diversification Opportunities for Cogna Educacao and Grand Canyon
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cogna and Grand is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Cogna Educacao SA and Grand Canyon Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grand Canyon Education and Cogna Educacao 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 Cogna Educacao SA are associated (or correlated) with Grand Canyon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grand Canyon Education has no effect on the direction of Cogna Educacao i.e., Cogna Educacao and Grand Canyon go up and down completely randomly.
Pair Corralation between Cogna Educacao and Grand Canyon
Assuming the 90 days horizon Cogna Educacao SA is expected to generate 4.85 times more return on investment than Grand Canyon. However, Cogna Educacao is 4.85 times more volatile than Grand Canyon Education. It trades about 0.03 of its potential returns per unit of risk. Grand Canyon Education is currently generating about 0.06 per unit of risk. If you would invest 38.00 in Cogna Educacao SA on November 1, 2024 and sell it today you would lose (12.00) from holding Cogna Educacao SA or give up 31.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Cogna Educacao SA vs. Grand Canyon Education
Performance |
| Timeline |
| Cogna Educacao SA |
| Grand Canyon Education |
Cogna Educacao and Grand Canyon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cogna Educacao and Grand Canyon
The main advantage of trading using opposite Cogna Educacao and Grand Canyon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cogna Educacao position performs unexpectedly, Grand Canyon 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 Grand Canyon will offset losses from the drop in Grand Canyon's long position.| Cogna Educacao vs. Universal Technical Institute | Cogna Educacao vs. ATA Creativity Global | Cogna Educacao vs. Sunlands Technology Group | Cogna Educacao vs. Vasta Platform |
| Grand Canyon vs. Lincoln Educational Services | Grand Canyon vs. Adtalem Global Education | Grand Canyon vs. Strategic Education | Grand Canyon vs. Laureate 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 CEOs Directory module to screen CEOs from public companies around the world.
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