Correlation Between Argan and Dirtt Environmen
Can any of the company-specific risk be diversified away by investing in both Argan and Dirtt Environmen 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 Argan and Dirtt Environmen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Argan Inc and Dirtt Environmen, you can compare the effects of market volatilities on Argan and Dirtt Environmen 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 Argan with a short position of Dirtt Environmen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argan and Dirtt Environmen.
Diversification Opportunities for Argan and Dirtt Environmen
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Argan and Dirtt is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Argan Inc and Dirtt Environmen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dirtt Environmen and Argan 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 Argan Inc are associated (or correlated) with Dirtt Environmen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dirtt Environmen has no effect on the direction of Argan i.e., Argan and Dirtt Environmen go up and down completely randomly.
Pair Corralation between Argan and Dirtt Environmen
If you would invest 7,236 in Argan Inc on August 31, 2024 and sell it today you would earn a total of 8,269 from holding Argan Inc or generate 114.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 1.59% |
| Values | Daily Returns |
Argan Inc vs. Dirtt Environmen
Performance |
| Timeline |
| Argan Inc |
| Dirtt Environmen |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Argan and Dirtt Environmen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Argan and Dirtt Environmen
The main advantage of trading using opposite Argan and Dirtt Environmen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Argan position performs unexpectedly, Dirtt Environmen 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 Dirtt Environmen will offset losses from the drop in Dirtt Environmen's long position.| Argan vs. Arcosa Inc | Argan vs. Construction Partners | Argan vs. Topbuild Corp | Argan vs. Comfort Systems USA |
| Dirtt Environmen vs. Orion Group Holdings | Dirtt Environmen vs. ENGlobal | Dirtt Environmen vs. Cardno Limited | Dirtt Environmen vs. JNS Holdings Corp |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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