Correlation Between Dicker Data and Asara Resources
Can any of the company-specific risk be diversified away by investing in both Dicker Data and Asara Resources 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 Asara Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dicker Data and Asara Resources, you can compare the effects of market volatilities on Dicker Data and Asara Resources 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 Asara Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dicker Data and Asara Resources.
Diversification Opportunities for Dicker Data and Asara Resources
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dicker and Asara is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Dicker Data and Asara Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asara Resources 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 are associated (or correlated) with Asara Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asara Resources has no effect on the direction of Dicker Data i.e., Dicker Data and Asara Resources go up and down completely randomly.
Pair Corralation between Dicker Data and Asara Resources
Assuming the 90 days trading horizon Dicker Data is expected to generate 0.24 times more return on investment than Asara Resources. However, Dicker Data is 4.24 times less risky than Asara Resources. It trades about -0.07 of its potential returns per unit of risk. Asara Resources is currently generating about -0.2 per unit of risk. If you would invest 852.00 in Dicker Data on October 14, 2024 and sell it today you would lose (13.00) from holding Dicker Data or give up 1.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dicker Data vs. Asara Resources
Performance |
| Timeline |
| Dicker Data |
| Asara Resources |
Dicker Data and Asara Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dicker Data and Asara Resources
The main advantage of trading using opposite Dicker Data and Asara Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dicker Data position performs unexpectedly, Asara Resources 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 Asara Resources will offset losses from the drop in Asara Resources' long position.| Dicker Data vs. Ora Banda Mining | Dicker Data vs. Evolution Mining | Dicker Data vs. Technology One | Dicker Data vs. Sayona Mining |
| Asara Resources vs. Embark Education Group | Asara Resources vs. Dicker Data | Asara Resources vs. Data3 | Asara Resources vs. Air New Zealand |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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