Correlation Between Orbitech and Digital Power
Can any of the company-specific risk be diversified away by investing in both Orbitech and Digital Power 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 Orbitech and Digital Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Orbitech Co and Digital Power Communications, you can compare the effects of market volatilities on Orbitech and Digital Power 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 Orbitech with a short position of Digital Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Orbitech and Digital Power.
Diversification Opportunities for Orbitech and Digital Power
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Orbitech and Digital is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Orbitech Co and Digital Power Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digital Power Commun and Orbitech 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 Orbitech Co are associated (or correlated) with Digital Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digital Power Commun has no effect on the direction of Orbitech i.e., Orbitech and Digital Power go up and down completely randomly.
Pair Corralation between Orbitech and Digital Power
Assuming the 90 days trading horizon Orbitech Co is expected to generate 3.41 times more return on investment than Digital Power. However, Orbitech is 3.41 times more volatile than Digital Power Communications. It trades about 0.32 of its potential returns per unit of risk. Digital Power Communications is currently generating about -0.3 per unit of risk. If you would invest 199,200 in Orbitech Co on October 25, 2024 and sell it today you would earn a total of 48,800 from holding Orbitech Co or generate 24.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Orbitech Co vs. Digital Power Communications
Performance |
| Timeline |
| Orbitech |
| Digital Power Commun |
Orbitech and Digital Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Orbitech and Digital Power
The main advantage of trading using opposite Orbitech and Digital Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Orbitech position performs unexpectedly, Digital Power 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 Digital Power will offset losses from the drop in Digital Power's long position.| Orbitech vs. Daishin Information Communications | Orbitech vs. Lotte Data Communication | Orbitech vs. Digital Power Communications | Orbitech vs. CG Hi Tech |
| Digital Power vs. KB Financial Group | Digital Power vs. Shinhan Financial Group | Digital Power vs. Hana Financial | Digital Power vs. Woori Financial Group |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |