Correlation Between Datang International and Identiv
Can any of the company-specific risk be diversified away by investing in both Datang International and Identiv 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 Datang International and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Datang International Power and Identiv, you can compare the effects of market volatilities on Datang International and Identiv 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 Datang International with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of Datang International and Identiv.
Diversification Opportunities for Datang International and Identiv
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Datang and Identiv is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Datang International Power and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and Datang International 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 Datang International Power are associated (or correlated) with Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of Datang International i.e., Datang International and Identiv go up and down completely randomly.
Pair Corralation between Datang International and Identiv
Assuming the 90 days horizon Datang International is expected to generate 1.81 times less return on investment than Identiv. In addition to that, Datang International is 1.45 times more volatile than Identiv. It trades about 0.05 of its total potential returns per unit of risk. Identiv is currently generating about 0.14 per unit of volatility. If you would invest 310.00 in Identiv on August 25, 2024 and sell it today you would earn a total of 50.00 from holding Identiv or generate 16.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Datang International Power vs. Identiv
Performance |
| Timeline |
| Datang International |
| Identiv |
Datang International and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Datang International and Identiv
The main advantage of trading using opposite Datang International and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Datang International position performs unexpectedly, Identiv 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 Identiv will offset losses from the drop in Identiv's long position.| Datang International vs. Superior Plus Corp | Datang International vs. Origin Agritech | Datang International vs. Identiv | Datang International vs. INTUITIVE SURGICAL |
| Identiv vs. COVIVIO HOTELS INH | Identiv vs. Alaska Air Group | Identiv vs. Hyatt Hotels | Identiv vs. LAir Liquide SA |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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