Correlation Between Grand Canyon and Afya
Can any of the company-specific risk be diversified away by investing in both Grand Canyon and Afya 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 Afya 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 Afya, you can compare the effects of market volatilities on Grand Canyon and Afya 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 Afya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Grand Canyon and Afya.
Diversification Opportunities for Grand Canyon and Afya
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Grand and Afya is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Grand Canyon Education and Afya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Afya 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 Afya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Afya has no effect on the direction of Grand Canyon i.e., Grand Canyon and Afya go up and down completely randomly.
Pair Corralation between Grand Canyon and Afya
Given the investment horizon of 90 days Grand Canyon Education is expected to generate 0.79 times more return on investment than Afya. However, Grand Canyon Education is 1.27 times less risky than Afya. It trades about 0.07 of its potential returns per unit of risk. Afya is currently generating about -0.04 per unit of risk. If you would invest 13,480 in Grand Canyon Education on August 27, 2024 and sell it today you would earn a total of 3,165 from holding Grand Canyon Education or generate 23.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Grand Canyon Education vs. Afya
Performance |
| Timeline |
| Grand Canyon Education |
| Afya |
Grand Canyon and Afya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Grand Canyon and Afya
The main advantage of trading using opposite Grand Canyon and Afya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Grand Canyon position performs unexpectedly, Afya 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 Afya will offset losses from the drop in Afya's long position.| Grand Canyon vs. American Public Education | Grand Canyon vs. Lincoln Educational Services | Grand Canyon vs. Adtalem Global Education |
| Afya vs. American Public Education | Afya vs. Lincoln Educational Services | Afya 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |