Correlation Between Dicker Data and Northern Star
Can any of the company-specific risk be diversified away by investing in both Dicker Data and Northern Star 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 Northern Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dicker Data and Northern Star Resources, you can compare the effects of market volatilities on Dicker Data and Northern Star 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 Northern Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dicker Data and Northern Star.
Diversification Opportunities for Dicker Data and Northern Star
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dicker and Northern is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Dicker Data and Northern Star Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Northern Star 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 Northern Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Northern Star Resources has no effect on the direction of Dicker Data i.e., Dicker Data and Northern Star go up and down completely randomly.
Pair Corralation between Dicker Data and Northern Star
Assuming the 90 days trading horizon Dicker Data is expected to under-perform the Northern Star. But the stock apears to be less risky and, when comparing its historical volatility, Dicker Data is 1.45 times less risky than Northern Star. The stock trades about -0.08 of its potential returns per unit of risk. The Northern Star Resources is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,487 in Northern Star Resources on September 3, 2024 and sell it today you would earn a total of 264.00 from holding Northern Star Resources or generate 17.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dicker Data vs. Northern Star Resources
Performance |
| Timeline |
| Dicker Data |
| Northern Star Resources |
Dicker Data and Northern Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dicker Data and Northern Star
The main advantage of trading using opposite Dicker Data and Northern Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dicker Data position performs unexpectedly, Northern Star 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 Northern Star will offset losses from the drop in Northern Star's long position.| Dicker Data vs. Stelar Metals | Dicker Data vs. MetalsGrove Mining | Dicker Data vs. Perseus Mining | Dicker Data vs. Infomedia |
| Northern Star vs. MetalsGrove Mining | Northern Star vs. Lendlease Group | Northern Star vs. Dicker Data | Northern Star vs. DY6 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |