Correlation Between DIH Holdings and HUTCHMED DRC
Can any of the company-specific risk be diversified away by investing in both DIH Holdings and HUTCHMED DRC 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 DIH Holdings and HUTCHMED DRC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DIH Holdings US, and HUTCHMED DRC, you can compare the effects of market volatilities on DIH Holdings and HUTCHMED DRC 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 DIH Holdings with a short position of HUTCHMED DRC. Check out your portfolio center. Please also check ongoing floating volatility patterns of DIH Holdings and HUTCHMED DRC.
Diversification Opportunities for DIH Holdings and HUTCHMED DRC
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between DIH and HUTCHMED is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding DIH Holdings US, and HUTCHMED DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUTCHMED DRC and DIH Holdings 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 DIH Holdings US, are associated (or correlated) with HUTCHMED DRC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUTCHMED DRC has no effect on the direction of DIH Holdings i.e., DIH Holdings and HUTCHMED DRC go up and down completely randomly.
Pair Corralation between DIH Holdings and HUTCHMED DRC
Given the investment horizon of 90 days DIH Holdings US, is expected to under-perform the HUTCHMED DRC. In addition to that, DIH Holdings is 6.9 times more volatile than HUTCHMED DRC. It trades about -0.05 of its total potential returns per unit of risk. HUTCHMED DRC is currently generating about -0.14 per unit of volatility. If you would invest 1,508 in HUTCHMED DRC on November 3, 2024 and sell it today you would lose (156.00) from holding HUTCHMED DRC or give up 10.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DIH Holdings US, vs. HUTCHMED DRC
Performance |
| Timeline |
| DIH Holdings US, |
| HUTCHMED DRC |
DIH Holdings and HUTCHMED DRC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DIH Holdings and HUTCHMED DRC
The main advantage of trading using opposite DIH Holdings and HUTCHMED DRC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DIH Holdings position performs unexpectedly, HUTCHMED DRC 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 HUTCHMED DRC will offset losses from the drop in HUTCHMED DRC's long position.| DIH Holdings vs. Amkor Technology | DIH Holdings vs. Western Copper and | DIH Holdings vs. Highway Holdings Limited | DIH Holdings vs. Weibo Corp |
| HUTCHMED DRC vs. ANI Pharmaceuticals | HUTCHMED DRC vs. Phibro Animal Health | HUTCHMED DRC vs. Prestige Brand Holdings | HUTCHMED DRC vs. Pacira BioSciences, |
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 Stocks Directory module to find actively traded stocks across global markets.
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