Correlation Between Applied Digital and 4imprint Group
Can any of the company-specific risk be diversified away by investing in both Applied Digital and 4imprint Group 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 Applied Digital and 4imprint Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Applied Digital and 4imprint Group plc, you can compare the effects of market volatilities on Applied Digital and 4imprint Group 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 Applied Digital with a short position of 4imprint Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Applied Digital and 4imprint Group.
Diversification Opportunities for Applied Digital and 4imprint Group
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Applied and 4imprint is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Applied Digital and 4imprint Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 4imprint Group plc and Applied Digital 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 Applied Digital are associated (or correlated) with 4imprint Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 4imprint Group plc has no effect on the direction of Applied Digital i.e., Applied Digital and 4imprint Group go up and down completely randomly.
Pair Corralation between Applied Digital and 4imprint Group
Given the investment horizon of 90 days Applied Digital is expected to generate 2.56 times more return on investment than 4imprint Group. However, Applied Digital is 2.56 times more volatile than 4imprint Group plc. It trades about 0.07 of its potential returns per unit of risk. 4imprint Group plc is currently generating about 0.05 per unit of risk. If you would invest 264.00 in Applied Digital on November 27, 2024 and sell it today you would earn a total of 637.00 from holding Applied Digital or generate 241.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 33.76% |
| Values | Daily Returns |
Applied Digital vs. 4imprint Group plc
Performance |
| Timeline |
| Applied Digital |
| 4imprint Group plc |
Applied Digital and 4imprint Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Applied Digital and 4imprint Group
The main advantage of trading using opposite Applied Digital and 4imprint Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Applied Digital position performs unexpectedly, 4imprint Group 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 4imprint Group will offset losses from the drop in 4imprint Group's long position.| Applied Digital vs. Magic Empire Global | Applied Digital vs. Zhong Yang Financial | Applied Digital vs. Netcapital | Applied Digital vs. Lazard |
| 4imprint Group vs. Inuvo Inc | 4imprint Group vs. Clubhouse Media Group | 4imprint Group vs. Pervasip Corp | 4imprint Group vs. Mirriad Advertising plc |
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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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