Correlation Between Caseys General and DATAGROUP
Can any of the company-specific risk be diversified away by investing in both Caseys General and DATAGROUP 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 Caseys General and DATAGROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caseys General Stores and DATAGROUP SE, you can compare the effects of market volatilities on Caseys General and DATAGROUP 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 Caseys General with a short position of DATAGROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caseys General and DATAGROUP.
Diversification Opportunities for Caseys General and DATAGROUP
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Caseys and DATAGROUP is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Caseys General Stores and DATAGROUP SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DATAGROUP SE and Caseys General 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 Caseys General Stores are associated (or correlated) with DATAGROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DATAGROUP SE has no effect on the direction of Caseys General i.e., Caseys General and DATAGROUP go up and down completely randomly.
Pair Corralation between Caseys General and DATAGROUP
Assuming the 90 days trading horizon Caseys General Stores is expected to generate 0.79 times more return on investment than DATAGROUP. However, Caseys General Stores is 1.27 times less risky than DATAGROUP. It trades about 0.12 of its potential returns per unit of risk. DATAGROUP SE is currently generating about -0.02 per unit of risk. If you would invest 20,207 in Caseys General Stores on September 4, 2024 and sell it today you would earn a total of 19,793 from holding Caseys General Stores or generate 97.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caseys General Stores vs. DATAGROUP SE
Performance |
| Timeline |
| Caseys General Stores |
| DATAGROUP SE |
Caseys General and DATAGROUP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caseys General and DATAGROUP
The main advantage of trading using opposite Caseys General and DATAGROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caseys General position performs unexpectedly, DATAGROUP 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 DATAGROUP will offset losses from the drop in DATAGROUP's long position.| Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple Inc |
| DATAGROUP vs. FUJITSU LTD ADR | DATAGROUP vs. Superior Plus Corp | DATAGROUP vs. NMI Holdings | DATAGROUP vs. Origin Agritech |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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