Correlation Between AKITA Drilling and DGTL Holdings
Can any of the company-specific risk be diversified away by investing in both AKITA Drilling and DGTL Holdings 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 AKITA Drilling and DGTL Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AKITA Drilling and DGTL Holdings, you can compare the effects of market volatilities on AKITA Drilling and DGTL Holdings 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 AKITA Drilling with a short position of DGTL Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of AKITA Drilling and DGTL Holdings.
Diversification Opportunities for AKITA Drilling and DGTL Holdings
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AKITA and DGTL is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding AKITA Drilling and DGTL Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DGTL Holdings and AKITA Drilling 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 AKITA Drilling are associated (or correlated) with DGTL Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DGTL Holdings has no effect on the direction of AKITA Drilling i.e., AKITA Drilling and DGTL Holdings go up and down completely randomly.
Pair Corralation between AKITA Drilling and DGTL Holdings
Assuming the 90 days trading horizon AKITA Drilling is expected to generate 65.76 times less return on investment than DGTL Holdings. But when comparing it to its historical volatility, AKITA Drilling is 15.74 times less risky than DGTL Holdings. It trades about 0.01 of its potential returns per unit of risk. DGTL Holdings is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 60.00 in DGTL Holdings on September 13, 2024 and sell it today you would lose (55.50) from holding DGTL Holdings or give up 92.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AKITA Drilling vs. DGTL Holdings
Performance |
| Timeline |
| AKITA Drilling |
| DGTL Holdings |
AKITA Drilling and DGTL Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AKITA Drilling and DGTL Holdings
The main advantage of trading using opposite AKITA Drilling and DGTL Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AKITA Drilling position performs unexpectedly, DGTL Holdings 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 DGTL Holdings will offset losses from the drop in DGTL Holdings' long position.| AKITA Drilling vs. Trican Well Service | AKITA Drilling vs. Ensign Energy Services | AKITA Drilling vs. Calfrac Well Services | AKITA Drilling vs. Birchcliff Energy |
| DGTL Holdings vs. Precision Drilling | DGTL Holdings vs. Verizon Communications CDR | DGTL Holdings vs. AKITA Drilling | DGTL Holdings vs. Stampede Drilling |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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