Correlation Between Digital Ally and Lizhi
Can any of the company-specific risk be diversified away by investing in both Digital Ally and Lizhi 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 Lizhi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digital Ally and Lizhi Inc, you can compare the effects of market volatilities on Digital Ally and Lizhi 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 Lizhi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital Ally and Lizhi.
Diversification Opportunities for Digital Ally and Lizhi
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Digital and Lizhi is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Digital Ally and Lizhi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lizhi Inc 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 Lizhi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lizhi Inc has no effect on the direction of Digital Ally i.e., Digital Ally and Lizhi go up and down completely randomly.
Pair Corralation between Digital Ally and Lizhi
If you would invest 101.00 in Digital Ally on August 24, 2024 and sell it today you would lose (4.00) from holding Digital Ally or give up 3.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Digital Ally vs. Lizhi Inc
Performance |
| Timeline |
| Digital Ally |
| Lizhi Inc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Digital Ally and Lizhi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital Ally and Lizhi
The main advantage of trading using opposite Digital Ally and Lizhi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital Ally position performs unexpectedly, Lizhi 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 Lizhi will offset losses from the drop in Lizhi's long position.| Digital Ally vs. Zedge Inc | Digital Ally vs. 36Kr Holdings | Digital Ally vs. MediaAlpha | Digital Ally vs. Vivid Seats |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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