Correlation Between Golden Sun and Gaotu Techedu
Can any of the company-specific risk be diversified away by investing in both Golden Sun and Gaotu Techedu 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 Golden Sun and Gaotu Techedu into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Golden Sun Education and Gaotu Techedu DRC, you can compare the effects of market volatilities on Golden Sun and Gaotu Techedu 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 Golden Sun with a short position of Gaotu Techedu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Sun and Gaotu Techedu.
Diversification Opportunities for Golden Sun and Gaotu Techedu
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Golden and Gaotu is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Golden Sun Education and Gaotu Techedu DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaotu Techedu DRC and Golden Sun 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 Golden Sun Education are associated (or correlated) with Gaotu Techedu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaotu Techedu DRC has no effect on the direction of Golden Sun i.e., Golden Sun and Gaotu Techedu go up and down completely randomly.
Pair Corralation between Golden Sun and Gaotu Techedu
Given the investment horizon of 90 days Golden Sun is expected to generate 1.67 times less return on investment than Gaotu Techedu. In addition to that, Golden Sun is 1.69 times more volatile than Gaotu Techedu DRC. It trades about 0.02 of its total potential returns per unit of risk. Gaotu Techedu DRC is currently generating about 0.04 per unit of volatility. If you would invest 185.00 in Gaotu Techedu DRC on September 3, 2024 and sell it today you would earn a total of 96.00 from holding Gaotu Techedu DRC or generate 51.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Golden Sun Education vs. Gaotu Techedu DRC
Performance |
| Timeline |
| Golden Sun Education |
| Gaotu Techedu DRC |
Golden Sun and Gaotu Techedu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Golden Sun and Gaotu Techedu
The main advantage of trading using opposite Golden Sun and Gaotu Techedu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Sun position performs unexpectedly, Gaotu Techedu 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 Gaotu Techedu will offset losses from the drop in Gaotu Techedu's long position.| Golden Sun vs. Wah Fu Education | Golden Sun vs. QuantaSing Group Limited | Golden Sun vs. Genius Group | Golden Sun vs. China Liberal Education |
| Gaotu Techedu vs. Wah Fu Education | Gaotu Techedu vs. Golden Sun Education | Gaotu Techedu vs. Elite Education Group | Gaotu Techedu vs. QuantaSing Group Limited |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |