Correlation Between Cepton and DSG Global
Can any of the company-specific risk be diversified away by investing in both Cepton and DSG Global 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 Cepton and DSG Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cepton Inc and DSG Global, you can compare the effects of market volatilities on Cepton and DSG Global 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 Cepton with a short position of DSG Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cepton and DSG Global.
Diversification Opportunities for Cepton and DSG Global
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cepton and DSG is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Cepton Inc and DSG Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DSG Global and Cepton 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 Cepton Inc are associated (or correlated) with DSG Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DSG Global has no effect on the direction of Cepton i.e., Cepton and DSG Global go up and down completely randomly.
Pair Corralation between Cepton and DSG Global
Assuming the 90 days horizon Cepton Inc is expected to under-perform the DSG Global. But the stock apears to be less risky and, when comparing its historical volatility, Cepton Inc is 28.56 times less risky than DSG Global. The stock trades about -0.21 of its potential returns per unit of risk. The DSG Global is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 0.01 in DSG Global on August 28, 2024 and sell it today you would earn a total of 0.00 from holding DSG Global or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Cepton Inc vs. DSG Global
Performance |
| Timeline |
| Cepton Inc |
| DSG Global |
Cepton and DSG Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cepton and DSG Global
The main advantage of trading using opposite Cepton and DSG Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cepton position performs unexpectedly, DSG Global 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 DSG Global will offset losses from the drop in DSG Global's long position.| Cepton vs. Cepton Inc | Cepton vs. Thayer Ventures Acquisition | Cepton vs. Anghami Warrants | Cepton vs. Inspirato |
| DSG Global vs. Garmin | DSG Global vs. Keysight Technologies | DSG Global vs. Fortive Corp | DSG Global vs. Teledyne Technologies Incorporated |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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