Correlation Between Endeavour Mining and Digilife Technologies
Can any of the company-specific risk be diversified away by investing in both Endeavour Mining and Digilife Technologies 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 Endeavour Mining and Digilife Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Endeavour Mining PLC and Digilife Technologies Limited, you can compare the effects of market volatilities on Endeavour Mining and Digilife Technologies 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 Endeavour Mining with a short position of Digilife Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Endeavour Mining and Digilife Technologies.
Diversification Opportunities for Endeavour Mining and Digilife Technologies
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Endeavour and Digilife is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Endeavour Mining PLC and Digilife Technologies Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digilife Technologies and Endeavour Mining 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 Endeavour Mining PLC are associated (or correlated) with Digilife Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digilife Technologies has no effect on the direction of Endeavour Mining i.e., Endeavour Mining and Digilife Technologies go up and down completely randomly.
Pair Corralation between Endeavour Mining and Digilife Technologies
Assuming the 90 days trading horizon Endeavour Mining PLC is expected to generate 0.55 times more return on investment than Digilife Technologies. However, Endeavour Mining PLC is 1.8 times less risky than Digilife Technologies. It trades about 0.02 of its potential returns per unit of risk. Digilife Technologies Limited is currently generating about 0.0 per unit of risk. If you would invest 1,810 in Endeavour Mining PLC on November 7, 2024 and sell it today you would earn a total of 278.00 from holding Endeavour Mining PLC or generate 15.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Endeavour Mining PLC vs. Digilife Technologies Limited
Performance |
| Timeline |
| Endeavour Mining PLC |
| Digilife Technologies |
Endeavour Mining and Digilife Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Endeavour Mining and Digilife Technologies
The main advantage of trading using opposite Endeavour Mining and Digilife Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Endeavour Mining position performs unexpectedly, Digilife Technologies 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 Digilife Technologies will offset losses from the drop in Digilife Technologies' long position.| Endeavour Mining vs. Apollo Investment Corp | Endeavour Mining vs. Gladstone Investment | Endeavour Mining vs. New Residential Investment | Endeavour Mining vs. CDL INVESTMENT |
| Digilife Technologies vs. The Yokohama Rubber | Digilife Technologies vs. Summit Materials | Digilife Technologies vs. GAMING FAC SA | Digilife Technologies vs. Heidelberg Materials AG |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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