Correlation Between DBS Group and COLUMBIA SPORTSWEAR
Can any of the company-specific risk be diversified away by investing in both DBS Group and COLUMBIA SPORTSWEAR 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 DBS Group and COLUMBIA SPORTSWEAR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DBS Group Holdings and COLUMBIA SPORTSWEAR, you can compare the effects of market volatilities on DBS Group and COLUMBIA SPORTSWEAR 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 DBS Group with a short position of COLUMBIA SPORTSWEAR. Check out your portfolio center. Please also check ongoing floating volatility patterns of DBS Group and COLUMBIA SPORTSWEAR.
Diversification Opportunities for DBS Group and COLUMBIA SPORTSWEAR
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DBS and COLUMBIA is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding DBS Group Holdings and COLUMBIA SPORTSWEAR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COLUMBIA SPORTSWEAR and DBS Group 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 DBS Group Holdings are associated (or correlated) with COLUMBIA SPORTSWEAR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COLUMBIA SPORTSWEAR has no effect on the direction of DBS Group i.e., DBS Group and COLUMBIA SPORTSWEAR go up and down completely randomly.
Pair Corralation between DBS Group and COLUMBIA SPORTSWEAR
Assuming the 90 days trading horizon DBS Group Holdings is expected to generate 0.86 times more return on investment than COLUMBIA SPORTSWEAR. However, DBS Group Holdings is 1.16 times less risky than COLUMBIA SPORTSWEAR. It trades about 0.16 of its potential returns per unit of risk. COLUMBIA SPORTSWEAR is currently generating about 0.07 per unit of risk. If you would invest 2,089 in DBS Group Holdings on September 3, 2024 and sell it today you would earn a total of 911.00 from holding DBS Group Holdings or generate 43.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DBS Group Holdings vs. COLUMBIA SPORTSWEAR
Performance |
| Timeline |
| DBS Group Holdings |
| COLUMBIA SPORTSWEAR |
DBS Group and COLUMBIA SPORTSWEAR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DBS Group and COLUMBIA SPORTSWEAR
The main advantage of trading using opposite DBS Group and COLUMBIA SPORTSWEAR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DBS Group position performs unexpectedly, COLUMBIA SPORTSWEAR 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 COLUMBIA SPORTSWEAR will offset losses from the drop in COLUMBIA SPORTSWEAR's long position.| DBS Group vs. DFS Furniture PLC | DBS Group vs. GLG LIFE TECH | DBS Group vs. CENTURIA OFFICE REIT | DBS Group vs. Lion Biotechnologies |
| COLUMBIA SPORTSWEAR vs. TOTAL GABON | COLUMBIA SPORTSWEAR vs. Walgreens Boots Alliance | COLUMBIA SPORTSWEAR vs. Peak Resources Limited |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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