Correlation Between Grand Canyon and 10X GENOMICS
Can any of the company-specific risk be diversified away by investing in both Grand Canyon and 10X GENOMICS 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 Grand Canyon and 10X GENOMICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Grand Canyon Education and 10X GENOMICS DL, you can compare the effects of market volatilities on Grand Canyon and 10X GENOMICS 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 Grand Canyon with a short position of 10X GENOMICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grand Canyon and 10X GENOMICS.
Diversification Opportunities for Grand Canyon and 10X GENOMICS
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Grand and 10X is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Grand Canyon Education and 10X GENOMICS DL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 10X GENOMICS DL and Grand Canyon 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 Grand Canyon Education are associated (or correlated) with 10X GENOMICS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 10X GENOMICS DL has no effect on the direction of Grand Canyon i.e., Grand Canyon and 10X GENOMICS go up and down completely randomly.
Pair Corralation between Grand Canyon and 10X GENOMICS
Assuming the 90 days trading horizon Grand Canyon is expected to generate 1.04 times less return on investment than 10X GENOMICS. But when comparing it to its historical volatility, Grand Canyon Education is 3.25 times less risky than 10X GENOMICS. It trades about 0.03 of its potential returns per unit of risk. 10X GENOMICS DL is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,506 in 10X GENOMICS DL on September 13, 2024 and sell it today you would lose (27.00) from holding 10X GENOMICS DL or give up 1.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grand Canyon Education vs. 10X GENOMICS DL
Performance |
| Timeline |
| Grand Canyon Education |
| 10X GENOMICS DL |
Grand Canyon and 10X GENOMICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grand Canyon and 10X GENOMICS
The main advantage of trading using opposite Grand Canyon and 10X GENOMICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grand Canyon position performs unexpectedly, 10X GENOMICS 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 10X GENOMICS will offset losses from the drop in 10X GENOMICS's long position.| Grand Canyon vs. Apple Inc | Grand Canyon vs. Apple Inc | Grand Canyon vs. Apple Inc | Grand Canyon vs. Apple Inc |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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