Correlation Between Golden Sun and Genius
Can any of the company-specific risk be diversified away by investing in both Golden Sun and Genius 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 Genius 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 Genius Group, you can compare the effects of market volatilities on Golden Sun and Genius 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 Genius. Check out your portfolio center. Please also check ongoing floating volatility patterns of Golden Sun and Genius.
Diversification Opportunities for Golden Sun and Genius
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Golden and Genius is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Golden Sun Education and Genius Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genius Group 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 Genius. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genius Group has no effect on the direction of Golden Sun i.e., Golden Sun and Genius go up and down completely randomly.
Pair Corralation between Golden Sun and Genius
Given the investment horizon of 90 days Golden Sun Education is expected to generate 2.41 times more return on investment than Genius. However, Golden Sun is 2.41 times more volatile than Genius Group. It trades about 0.09 of its potential returns per unit of risk. Genius Group is currently generating about -0.26 per unit of risk. If you would invest 559.00 in Golden Sun Education on March 21, 2024 and sell it today you would earn a total of 46.00 from holding Golden Sun Education or generate 8.23% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Golden Sun Education vs. Genius Group
Performance |
Timeline |
Golden Sun Education |
Genius Group |
Golden Sun and Genius Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Golden Sun and Genius
The main advantage of trading using opposite Golden Sun and Genius positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Golden Sun position performs unexpectedly, Genius 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 Genius will offset losses from the drop in Genius' long position.Golden Sun vs. Laureate Education | Golden Sun vs. American Public Education | Golden Sun vs. Lincoln Educational Services | Golden Sun vs. Adtalem Global Education |
Genius vs. Laureate Education | Genius vs. American Public Education | Genius vs. Lincoln Educational Services | Genius 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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