Correlation Between Eldorado Gold and Bright Scholar
Can any of the company-specific risk be diversified away by investing in both Eldorado Gold and Bright Scholar 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 Eldorado Gold and Bright Scholar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eldorado Gold Corp and Bright Scholar Education, you can compare the effects of market volatilities on Eldorado Gold and Bright Scholar 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 Eldorado Gold with a short position of Bright Scholar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eldorado Gold and Bright Scholar.
Diversification Opportunities for Eldorado Gold and Bright Scholar
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Eldorado and Bright is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Eldorado Gold Corp and Bright Scholar Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bright Scholar Education and Eldorado Gold 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 Eldorado Gold Corp are associated (or correlated) with Bright Scholar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bright Scholar Education has no effect on the direction of Eldorado Gold i.e., Eldorado Gold and Bright Scholar go up and down completely randomly.
Pair Corralation between Eldorado Gold and Bright Scholar
Considering the 90-day investment horizon Eldorado Gold Corp is expected to under-perform the Bright Scholar. In addition to that, Eldorado Gold is 1.05 times more volatile than Bright Scholar Education. It trades about -0.12 of its total potential returns per unit of risk. Bright Scholar Education is currently generating about 0.0 per unit of volatility. If you would invest 186.00 in Bright Scholar Education on August 27, 2024 and sell it today you would lose (1.00) from holding Bright Scholar Education or give up 0.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
Eldorado Gold Corp vs. Bright Scholar Education
Performance |
| Timeline |
| Eldorado Gold Corp |
| Bright Scholar Education |
Eldorado Gold and Bright Scholar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eldorado Gold and Bright Scholar
The main advantage of trading using opposite Eldorado Gold and Bright Scholar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eldorado Gold position performs unexpectedly, Bright Scholar 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 Bright Scholar will offset losses from the drop in Bright Scholar's long position.| Eldorado Gold vs. IAMGold | Eldorado Gold vs. Kinross Gold | Eldorado Gold vs. Agnico Eagle Mines | Eldorado Gold vs. Gold Fields Ltd |
| Bright Scholar vs. American Public Education | Bright Scholar vs. Lincoln Educational Services | Bright Scholar vs. Adtalem Global 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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