Correlation Between Digital Ally and Jiayin
Can any of the company-specific risk be diversified away by investing in both Digital Ally and Jiayin 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 Digital Ally and Jiayin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digital Ally and Jiayin Group, you can compare the effects of market volatilities on Digital Ally and Jiayin 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 Digital Ally with a short position of Jiayin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital Ally and Jiayin.
Diversification Opportunities for Digital Ally and Jiayin
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Digital and Jiayin is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Digital Ally and Jiayin Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiayin Group and Digital Ally 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 Digital Ally are associated (or correlated) with Jiayin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiayin Group has no effect on the direction of Digital Ally i.e., Digital Ally and Jiayin go up and down completely randomly.
Pair Corralation between Digital Ally and Jiayin
Given the investment horizon of 90 days Digital Ally is expected to under-perform the Jiayin. In addition to that, Digital Ally is 3.47 times more volatile than Jiayin Group. It trades about -0.03 of its total potential returns per unit of risk. Jiayin Group is currently generating about 0.35 per unit of volatility. If you would invest 626.00 in Jiayin Group on October 21, 2024 and sell it today you would earn a total of 104.00 from holding Jiayin Group or generate 16.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digital Ally vs. Jiayin Group
Performance |
| Timeline |
| Digital Ally |
| Jiayin Group |
Digital Ally and Jiayin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital Ally and Jiayin
The main advantage of trading using opposite Digital Ally and Jiayin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital Ally position performs unexpectedly, Jiayin 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 Jiayin will offset losses from the drop in Jiayin's long position.| Digital Ally vs. Zedge Inc | Digital Ally vs. 36Kr Holdings | Digital Ally vs. MediaAlpha | Digital Ally vs. Vivid Seats |
| Jiayin vs. Oriental Culture Holding | Jiayin vs. Wisekey International Holding | Jiayin vs. Wah Fu Education |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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