Correlation Between Lixiang Education and Grand Canyon
Can any of the company-specific risk be diversified away by investing in both Lixiang Education 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 Lixiang Education and Grand Canyon into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lixiang Education Holding and Grand Canyon Education, you can compare the effects of market volatilities on Lixiang Education 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 Lixiang Education with a short position of Grand Canyon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lixiang Education and Grand Canyon.
Diversification Opportunities for Lixiang Education and Grand Canyon
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Lixiang and Grand is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Lixiang Education Holding 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 Lixiang Education 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 Lixiang Education Holding 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 Lixiang Education i.e., Lixiang Education and Grand Canyon go up and down completely randomly.
Pair Corralation between Lixiang Education and Grand Canyon
Given the investment horizon of 90 days Lixiang Education Holding is expected to under-perform the Grand Canyon. In addition to that, Lixiang Education is 3.2 times more volatile than Grand Canyon Education. It trades about -0.1 of its total potential returns per unit of risk. Grand Canyon Education is currently generating about 0.14 per unit of volatility. If you would invest 14,185 in Grand Canyon Education on August 30, 2024 and sell it today you would earn a total of 2,294 from holding Grand Canyon Education or generate 16.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lixiang Education Holding vs. Grand Canyon Education
Performance |
| Timeline |
| Lixiang Education Holding |
| Grand Canyon Education |
Lixiang Education and Grand Canyon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lixiang Education and Grand Canyon
The main advantage of trading using opposite Lixiang Education and Grand Canyon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lixiang Education 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.| Lixiang Education vs. China Liberal Education | Lixiang Education vs. Four Seasons Education | Lixiang Education vs. Jianzhi Education Technology | Lixiang Education vs. Elite Education Group |
| 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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