Correlation Between DXC Technology and Carlsberg
Can any of the company-specific risk be diversified away by investing in both DXC Technology and Carlsberg 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 DXC Technology and Carlsberg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DXC Technology Co and Carlsberg AS B, you can compare the effects of market volatilities on DXC Technology and Carlsberg 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 DXC Technology with a short position of Carlsberg. Check out your portfolio center. Please also check ongoing floating volatility patterns of DXC Technology and Carlsberg.
Diversification Opportunities for DXC Technology and Carlsberg
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DXC and Carlsberg is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding DXC Technology Co and Carlsberg AS B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlsberg AS B and DXC Technology 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 DXC Technology Co are associated (or correlated) with Carlsberg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlsberg AS B has no effect on the direction of DXC Technology i.e., DXC Technology and Carlsberg go up and down completely randomly.
Pair Corralation between DXC Technology and Carlsberg
Assuming the 90 days trading horizon DXC Technology Co is expected to generate 2.12 times more return on investment than Carlsberg. However, DXC Technology is 2.12 times more volatile than Carlsberg AS B. It trades about 0.0 of its potential returns per unit of risk. Carlsberg AS B is currently generating about -0.02 per unit of risk. If you would invest 2,781 in DXC Technology Co on August 24, 2024 and sell it today you would lose (559.00) from holding DXC Technology Co or give up 20.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.19% |
| Values | Daily Returns |
DXC Technology Co vs. Carlsberg AS B
Performance |
| Timeline |
| DXC Technology |
| Carlsberg AS B |
DXC Technology and Carlsberg Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DXC Technology and Carlsberg
The main advantage of trading using opposite DXC Technology and Carlsberg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DXC Technology position performs unexpectedly, Carlsberg 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 Carlsberg will offset losses from the drop in Carlsberg's long position.| DXC Technology vs. International Biotechnology Trust | DXC Technology vs. MediaZest plc | DXC Technology vs. G5 Entertainment AB | DXC Technology vs. Blackrock World Mining |
| Carlsberg vs. Sabien Technology Group | Carlsberg vs. DXC Technology Co | Carlsberg vs. Livermore Investments Group | Carlsberg vs. New Residential Investment |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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