Correlation Between Digi International and NH Foods
Can any of the company-specific risk be diversified away by investing in both Digi International and NH Foods 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 Digi International and NH Foods into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digi International and NH Foods Ltd, you can compare the effects of market volatilities on Digi International and NH Foods 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 Digi International with a short position of NH Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digi International and NH Foods.
Diversification Opportunities for Digi International and NH Foods
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Digi and NIPMY is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Digi International and NH Foods Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NH Foods and Digi International 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 Digi International are associated (or correlated) with NH Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NH Foods has no effect on the direction of Digi International i.e., Digi International and NH Foods go up and down completely randomly.
Pair Corralation between Digi International and NH Foods
If you would invest 3,051 in Digi International on August 27, 2024 and sell it today you would earn a total of 313.00 from holding Digi International or generate 10.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digi International vs. NH Foods Ltd
Performance |
| Timeline |
| Digi International |
| NH Foods |
Digi International and NH Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digi International and NH Foods
The main advantage of trading using opposite Digi International and NH Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digi International position performs unexpectedly, NH Foods 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 NH Foods will offset losses from the drop in NH Foods' long position.| Digi International vs. Ichor Holdings | Digi International vs. Fabrinet | Digi International vs. Hello Group | Digi International vs. Ultra Clean Holdings |
| NH Foods vs. Artisan Consumer Goods | NH Foods vs. The A2 Milk | NH Foods vs. BioAdaptives | NH Foods vs. General Mills |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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