Correlation Between Dicker Data and National Australia
Can any of the company-specific risk be diversified away by investing in both Dicker Data and National Australia 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 National Australia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dicker Data and National Australia Bank, you can compare the effects of market volatilities on Dicker Data and National Australia 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 National Australia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dicker Data and National Australia.
Diversification Opportunities for Dicker Data and National Australia
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dicker and National is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Dicker Data and National Australia Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Australia Bank 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 National Australia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Australia Bank has no effect on the direction of Dicker Data i.e., Dicker Data and National Australia go up and down completely randomly.
Pair Corralation between Dicker Data and National Australia
Assuming the 90 days trading horizon Dicker Data is expected to generate 16.95 times less return on investment than National Australia. In addition to that, Dicker Data is 1.69 times more volatile than National Australia Bank. It trades about 0.0 of its total potential returns per unit of risk. National Australia Bank is currently generating about 0.14 per unit of volatility. If you would invest 3,797 in National Australia Bank on September 1, 2024 and sell it today you would earn a total of 113.00 from holding National Australia Bank or generate 2.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dicker Data vs. National Australia Bank
Performance |
| Timeline |
| Dicker Data |
| National Australia Bank |
Dicker Data and National Australia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dicker Data and National Australia
The main advantage of trading using opposite Dicker Data and National Australia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dicker Data position performs unexpectedly, National Australia 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 National Australia will offset losses from the drop in National Australia's long position.| Dicker Data vs. K2 Asset Management | Dicker Data vs. Homeco Daily Needs | Dicker Data vs. Home Consortium | Dicker Data vs. Alternative Investment Trust |
| National Australia vs. 29Metals | National Australia vs. Thorney Technologies | National Australia vs. Macquarie Technology Group | National Australia vs. Sky Metals |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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