Correlation Between Delta Electronics and Dexon Technology
Can any of the company-specific risk be diversified away by investing in both Delta Electronics and Dexon Technology 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 Delta Electronics and Dexon Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delta Electronics Public and Dexon Technology PCL, you can compare the effects of market volatilities on Delta Electronics and Dexon Technology 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 Delta Electronics with a short position of Dexon Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Electronics and Dexon Technology.
Diversification Opportunities for Delta Electronics and Dexon Technology
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Delta and Dexon is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Delta Electronics Public and Dexon Technology PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dexon Technology PCL and Delta Electronics 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 Delta Electronics Public are associated (or correlated) with Dexon Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dexon Technology PCL has no effect on the direction of Delta Electronics i.e., Delta Electronics and Dexon Technology go up and down completely randomly.
Pair Corralation between Delta Electronics and Dexon Technology
Assuming the 90 days trading horizon Delta Electronics Public is expected to generate 2.2 times more return on investment than Dexon Technology. However, Delta Electronics is 2.2 times more volatile than Dexon Technology PCL. It trades about -0.01 of its potential returns per unit of risk. Dexon Technology PCL is currently generating about -0.22 per unit of risk. If you would invest 15,550 in Delta Electronics Public on September 7, 2024 and sell it today you would lose (450.00) from holding Delta Electronics Public or give up 2.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delta Electronics Public vs. Dexon Technology PCL
Performance |
| Timeline |
| Delta Electronics Public |
| Dexon Technology PCL |
Delta Electronics and Dexon Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delta Electronics and Dexon Technology
The main advantage of trading using opposite Delta Electronics and Dexon Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delta Electronics position performs unexpectedly, Dexon Technology 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 Dexon Technology will offset losses from the drop in Dexon Technology's long position.| Delta Electronics vs. AP Public | Delta Electronics vs. Jasmine International Public | Delta Electronics vs. Asia Plus Group | Delta Electronics vs. Bangchak Public |
| Dexon Technology vs. Kang Yong Electric | Dexon Technology vs. Thai Rung Union | Dexon Technology vs. Grande Asset Hotels | Dexon Technology vs. Ama Marine Public |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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