Correlation Between DICKER DATA and CN DATANG
Can any of the company-specific risk be diversified away by investing in both DICKER DATA and CN DATANG 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 CN DATANG 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 CN DATANG C, you can compare the effects of market volatilities on DICKER DATA and CN DATANG 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 CN DATANG. Check out your portfolio center. Please also check ongoing floating volatility patterns of DICKER DATA and CN DATANG.
Diversification Opportunities for DICKER DATA and CN DATANG
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DICKER and DT7 is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding DICKER DATA LTD and CN DATANG C in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CN DATANG C 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 CN DATANG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CN DATANG C has no effect on the direction of DICKER DATA i.e., DICKER DATA and CN DATANG go up and down completely randomly.
Pair Corralation between DICKER DATA and CN DATANG
Assuming the 90 days horizon DICKER DATA LTD is expected to under-perform the CN DATANG. But the stock apears to be less risky and, when comparing its historical volatility, DICKER DATA LTD is 1.77 times less risky than CN DATANG. The stock trades about 0.0 of its potential returns per unit of risk. The CN DATANG C is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 14.00 in CN DATANG C on October 28, 2024 and sell it today you would earn a total of 10.00 from holding CN DATANG C or generate 71.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DICKER DATA LTD vs. CN DATANG C
Performance |
| Timeline |
| DICKER DATA LTD |
| CN DATANG C |
DICKER DATA and CN DATANG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DICKER DATA and CN DATANG
The main advantage of trading using opposite DICKER DATA and CN DATANG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DICKER DATA position performs unexpectedly, CN DATANG 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 CN DATANG will offset losses from the drop in CN DATANG's long position.| DICKER DATA vs. Arrow Electronics | DICKER DATA vs. Esprinet SpA | DICKER DATA vs. Wayside Technology Group | DICKER DATA vs. FORTEC Elektronik AG |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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