Correlation Between Digital Imaging and Sang A
Can any of the company-specific risk be diversified away by investing in both Digital Imaging and Sang A 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 Digital Imaging and Sang A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digital Imaging Technology and Sang A Frontec CoLtd, you can compare the effects of market volatilities on Digital Imaging and Sang A 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 Digital Imaging with a short position of Sang A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital Imaging and Sang A.
Diversification Opportunities for Digital Imaging and Sang A
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Digital and Sang is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Digital Imaging Technology and Sang A Frontec CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sang A Frontec and Digital Imaging 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 Digital Imaging Technology are associated (or correlated) with Sang A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sang A Frontec has no effect on the direction of Digital Imaging i.e., Digital Imaging and Sang A go up and down completely randomly.
Pair Corralation between Digital Imaging and Sang A
Assuming the 90 days trading horizon Digital Imaging Technology is expected to generate 1.45 times more return on investment than Sang A. However, Digital Imaging is 1.45 times more volatile than Sang A Frontec CoLtd. It trades about 0.2 of its potential returns per unit of risk. Sang A Frontec CoLtd is currently generating about 0.08 per unit of risk. If you would invest 1,092,000 in Digital Imaging Technology on September 20, 2024 and sell it today you would earn a total of 211,000 from holding Digital Imaging Technology or generate 19.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Digital Imaging Technology vs. Sang A Frontec CoLtd
Performance |
| Timeline |
| Digital Imaging Tech |
| Sang A Frontec |
Digital Imaging and Sang A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital Imaging and Sang A
The main advantage of trading using opposite Digital Imaging and Sang A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital Imaging position performs unexpectedly, Sang A 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 Sang A will offset losses from the drop in Sang A's long position.| Digital Imaging vs. Nice Information Telecommunication | Digital Imaging vs. Aprogen Healthcare Games | Digital Imaging vs. CKH Food Health | Digital Imaging vs. Insung Information Co |
| Sang A vs. Digital Imaging Technology | Sang A vs. Polaris Office Corp | Sang A vs. Eagle Veterinary Technology | Sang A vs. Eugene Technology CoLtd |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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