Correlation Between Autins Group and DG Innovate
Can any of the company-specific risk be diversified away by investing in both Autins Group and DG Innovate 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 Autins Group and DG Innovate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Autins Group plc and DG Innovate PLC, you can compare the effects of market volatilities on Autins Group and DG Innovate 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 Autins Group with a short position of DG Innovate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Autins Group and DG Innovate.
Diversification Opportunities for Autins Group and DG Innovate
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Autins and DGI is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Autins Group plc and DG Innovate PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DG Innovate PLC and Autins Group 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 Autins Group plc are associated (or correlated) with DG Innovate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DG Innovate PLC has no effect on the direction of Autins Group i.e., Autins Group and DG Innovate go up and down completely randomly.
Pair Corralation between Autins Group and DG Innovate
Assuming the 90 days trading horizon Autins Group plc is expected to under-perform the DG Innovate. But the stock apears to be less risky and, when comparing its historical volatility, Autins Group plc is 4.16 times less risky than DG Innovate. The stock trades about -0.03 of its potential returns per unit of risk. The DG Innovate PLC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3.45 in DG Innovate PLC on September 14, 2024 and sell it today you would earn a total of 5.05 from holding DG Innovate PLC or generate 146.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.63% |
| Values | Daily Returns |
Autins Group plc vs. DG Innovate PLC
Performance |
| Timeline |
| Autins Group plc |
| DG Innovate PLC |
Autins Group and DG Innovate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Autins Group and DG Innovate
The main advantage of trading using opposite Autins Group and DG Innovate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Autins Group position performs unexpectedly, DG Innovate 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 DG Innovate will offset losses from the drop in DG Innovate's long position.| Autins Group vs. DG Innovate PLC | Autins Group vs. Hardide PLC | Autins Group vs. Quantum Blockchain Technologies | Autins Group vs. Tungsten West PLC |
| DG Innovate vs. Quadrise Plc | DG Innovate vs. ImmuPharma PLC | DG Innovate vs. Intuitive Investments Group | DG Innovate vs. European Metals Holdings |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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