Correlation Between Automatic Data and Dubber
Can any of the company-specific risk be diversified away by investing in both Automatic Data and Dubber 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 Automatic Data and Dubber into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Automatic Data Processing and Dubber Limited, you can compare the effects of market volatilities on Automatic Data and Dubber 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 Automatic Data with a short position of Dubber. Check out your portfolio center. Please also check ongoing floating volatility patterns of Automatic Data and Dubber.
Diversification Opportunities for Automatic Data and Dubber
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Automatic and Dubber is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Automatic Data Processing and Dubber Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dubber Limited and Automatic Data 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 Automatic Data Processing are associated (or correlated) with Dubber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dubber Limited has no effect on the direction of Automatic Data i.e., Automatic Data and Dubber go up and down completely randomly.
Pair Corralation between Automatic Data and Dubber
Considering the 90-day investment horizon Automatic Data Processing is expected to generate 0.11 times more return on investment than Dubber. However, Automatic Data Processing is 9.22 times less risky than Dubber. It trades about -0.14 of its potential returns per unit of risk. Dubber Limited is currently generating about -0.05 per unit of risk. If you would invest 30,310 in Automatic Data Processing on September 24, 2024 and sell it today you would lose (895.00) from holding Automatic Data Processing or give up 2.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Automatic Data Processing vs. Dubber Limited
Performance |
| Timeline |
| Automatic Data Processing |
| Dubber Limited |
Automatic Data and Dubber Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Automatic Data and Dubber
The main advantage of trading using opposite Automatic Data and Dubber positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Automatic Data position performs unexpectedly, Dubber 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 Dubber will offset losses from the drop in Dubber's long position.| Automatic Data vs. Dubber Limited | Automatic Data vs. Advanced Health Intelligence | Automatic Data vs. Danavation Technologies Corp | Automatic Data vs. BASE Inc |
| Dubber vs. NextPlat Corp | Dubber vs. Liquid Avatar Technologies | Dubber vs. Waldencast Acquisition Corp | Dubber vs. CXApp Inc |
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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