Correlation Between DICKER DATA and SWISS WATER
Can any of the company-specific risk be diversified away by investing in both DICKER DATA and SWISS WATER 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 DICKER DATA and SWISS WATER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DICKER DATA LTD and SWISS WATER DECAFFCOFFEE, you can compare the effects of market volatilities on DICKER DATA and SWISS WATER 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 DICKER DATA with a short position of SWISS WATER. Check out your portfolio center. Please also check ongoing floating volatility patterns of DICKER DATA and SWISS WATER.
Diversification Opportunities for DICKER DATA and SWISS WATER
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between DICKER and SWISS is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding DICKER DATA LTD and SWISS WATER DECAFFCOFFEE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SWISS WATER DECAFFCOFFEE and DICKER DATA 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 DICKER DATA LTD are associated (or correlated) with SWISS WATER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SWISS WATER DECAFFCOFFEE has no effect on the direction of DICKER DATA i.e., DICKER DATA and SWISS WATER go up and down completely randomly.
Pair Corralation between DICKER DATA and SWISS WATER
Assuming the 90 days horizon DICKER DATA is expected to generate 1.75 times less return on investment than SWISS WATER. But when comparing it to its historical volatility, DICKER DATA LTD is 1.06 times less risky than SWISS WATER. It trades about 0.02 of its potential returns per unit of risk. SWISS WATER DECAFFCOFFEE is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 192.00 in SWISS WATER DECAFFCOFFEE on November 1, 2024 and sell it today you would earn a total of 36.00 from holding SWISS WATER DECAFFCOFFEE or generate 18.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DICKER DATA LTD vs. SWISS WATER DECAFFCOFFEE
Performance |
| Timeline |
| DICKER DATA LTD |
| SWISS WATER DECAFFCOFFEE |
DICKER DATA and SWISS WATER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DICKER DATA and SWISS WATER
The main advantage of trading using opposite DICKER DATA and SWISS WATER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DICKER DATA position performs unexpectedly, SWISS WATER 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 SWISS WATER will offset losses from the drop in SWISS WATER's long position.| DICKER DATA vs. GREENX METALS LTD | DICKER DATA vs. ADRIATIC METALS LS 013355 | DICKER DATA vs. REVO INSURANCE SPA | DICKER DATA vs. SUN LIFE FINANCIAL |
| SWISS WATER vs. DICKER DATA LTD | SWISS WATER vs. Liberty Broadband | SWISS WATER vs. Broadridge Financial Solutions | SWISS WATER vs. Air Transport Services |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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