Correlation Between Dicker Data and ABACUS STORAGE
Can any of the company-specific risk be diversified away by investing in both Dicker Data and ABACUS STORAGE 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 ABACUS STORAGE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dicker Data and ABACUS STORAGE KING, you can compare the effects of market volatilities on Dicker Data and ABACUS STORAGE 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 ABACUS STORAGE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dicker Data and ABACUS STORAGE.
Diversification Opportunities for Dicker Data and ABACUS STORAGE
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Dicker and ABACUS is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Dicker Data and ABACUS STORAGE KING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ABACUS STORAGE KING 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 ABACUS STORAGE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ABACUS STORAGE KING has no effect on the direction of Dicker Data i.e., Dicker Data and ABACUS STORAGE go up and down completely randomly.
Pair Corralation between Dicker Data and ABACUS STORAGE
Assuming the 90 days trading horizon Dicker Data is expected to generate 1.02 times more return on investment than ABACUS STORAGE. However, Dicker Data is 1.02 times more volatile than ABACUS STORAGE KING. It trades about -0.1 of its potential returns per unit of risk. ABACUS STORAGE KING is currently generating about -0.3 per unit of risk. If you would invest 862.00 in Dicker Data on August 25, 2024 and sell it today you would lose (25.00) from holding Dicker Data or give up 2.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dicker Data vs. ABACUS STORAGE KING
Performance |
| Timeline |
| Dicker Data |
| ABACUS STORAGE KING |
Dicker Data and ABACUS STORAGE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dicker Data and ABACUS STORAGE
The main advantage of trading using opposite Dicker Data and ABACUS STORAGE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dicker Data position performs unexpectedly, ABACUS STORAGE 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 ABACUS STORAGE will offset losses from the drop in ABACUS STORAGE's long position.| Dicker Data vs. Greenvale Energy | Dicker Data vs. Summit Resources Limited | Dicker Data vs. Ecofibre | Dicker Data vs. iShares Global Healthcare |
| ABACUS STORAGE vs. Westpac Banking | ABACUS STORAGE vs. Odyssey Energy | ABACUS STORAGE vs. Insurance Australia Group | ABACUS STORAGE vs. Origin Energy |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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