Correlation Between Digistar Bhd and Dufu Tech
Can any of the company-specific risk be diversified away by investing in both Digistar Bhd and Dufu Tech 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 Digistar Bhd and Dufu Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digistar Bhd and Dufu Tech Corp, you can compare the effects of market volatilities on Digistar Bhd and Dufu Tech 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 Digistar Bhd with a short position of Dufu Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digistar Bhd and Dufu Tech.
Diversification Opportunities for Digistar Bhd and Dufu Tech
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Digistar and Dufu is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Digistar Bhd and Dufu Tech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dufu Tech Corp and Digistar Bhd 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 Digistar Bhd are associated (or correlated) with Dufu Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dufu Tech Corp has no effect on the direction of Digistar Bhd i.e., Digistar Bhd and Dufu Tech go up and down completely randomly.
Pair Corralation between Digistar Bhd and Dufu Tech
Assuming the 90 days trading horizon Digistar Bhd is expected to generate 1.77 times less return on investment than Dufu Tech. In addition to that, Digistar Bhd is 2.25 times more volatile than Dufu Tech Corp. It trades about 0.0 of its total potential returns per unit of risk. Dufu Tech Corp is currently generating about 0.02 per unit of volatility. If you would invest 180.00 in Dufu Tech Corp on September 12, 2024 and sell it today you would earn a total of 6.00 from holding Dufu Tech Corp or generate 3.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.59% |
| Values | Daily Returns |
Digistar Bhd vs. Dufu Tech Corp
Performance |
| Timeline |
| Digistar Bhd |
| Dufu Tech Corp |
Digistar Bhd and Dufu Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digistar Bhd and Dufu Tech
The main advantage of trading using opposite Digistar Bhd and Dufu Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digistar Bhd position performs unexpectedly, Dufu Tech 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 Dufu Tech will offset losses from the drop in Dufu Tech's long position.| Digistar Bhd vs. Malayan Banking Bhd | Digistar Bhd vs. Public Bank Bhd | Digistar Bhd vs. Petronas Chemicals Group | Digistar Bhd vs. Tenaga Nasional Bhd |
| Dufu Tech vs. Kawan Food Bhd | Dufu Tech vs. Senheng New Retail | Dufu Tech vs. Press Metal Bhd | Dufu Tech vs. Berjaya Food Bhd |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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