Correlation Between Autosports and Dicker Data
Can any of the company-specific risk be diversified away by investing in both Autosports and Dicker Data 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 Autosports and Dicker Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Autosports Group and Dicker Data, you can compare the effects of market volatilities on Autosports and Dicker Data 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 Autosports with a short position of Dicker Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autosports and Dicker Data.
Diversification Opportunities for Autosports and Dicker Data
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Autosports and Dicker is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Autosports Group and Dicker Data in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dicker Data and Autosports 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 Autosports Group are associated (or correlated) with Dicker Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dicker Data has no effect on the direction of Autosports i.e., Autosports and Dicker Data go up and down completely randomly.
Pair Corralation between Autosports and Dicker Data
Assuming the 90 days trading horizon Autosports Group is expected to under-perform the Dicker Data. But the stock apears to be less risky and, when comparing its historical volatility, Autosports Group is 1.21 times less risky than Dicker Data. The stock trades about -0.57 of its potential returns per unit of risk. The Dicker Data is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 852.00 in Dicker Data on September 1, 2024 and sell it today you would lose (1.00) from holding Dicker Data or give up 0.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Autosports Group vs. Dicker Data
Performance |
| Timeline |
| Autosports Group |
| Dicker Data |
Autosports and Dicker Data Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autosports and Dicker Data
The main advantage of trading using opposite Autosports and Dicker Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autosports position performs unexpectedly, Dicker Data 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 Dicker Data will offset losses from the drop in Dicker Data's long position.| Autosports vs. Summit Resources Limited | Autosports vs. iShares Global Healthcare | Autosports vs. Australian Dairy Farms | Autosports vs. Adriatic Metals Plc |
| Dicker Data vs. K2 Asset Management | Dicker Data vs. Homeco Daily Needs | Dicker Data vs. Home Consortium | Dicker Data vs. Alternative Investment Trust |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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