Correlation Between Digi Communications and Imotrust
Can any of the company-specific risk be diversified away by investing in both Digi Communications and Imotrust 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 Communications and Imotrust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digi Communications NV and Imotrust SA, you can compare the effects of market volatilities on Digi Communications and Imotrust 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 Communications with a short position of Imotrust. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digi Communications and Imotrust.
Diversification Opportunities for Digi Communications and Imotrust
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Digi and Imotrust is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Digi Communications NV and Imotrust SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imotrust SA and Digi Communications 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 Communications NV are associated (or correlated) with Imotrust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imotrust SA has no effect on the direction of Digi Communications i.e., Digi Communications and Imotrust go up and down completely randomly.
Pair Corralation between Digi Communications and Imotrust
Assuming the 90 days trading horizon Digi Communications NV is expected to under-perform the Imotrust. But the stock apears to be less risky and, when comparing its historical volatility, Digi Communications NV is 3.06 times less risky than Imotrust. The stock trades about -0.11 of its potential returns per unit of risk. The Imotrust SA is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 11.00 in Imotrust SA on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Imotrust SA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digi Communications NV vs. Imotrust SA
Performance |
| Timeline |
| Digi Communications |
| Imotrust SA |
Digi Communications and Imotrust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digi Communications and Imotrust
The main advantage of trading using opposite Digi Communications and Imotrust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digi Communications position performs unexpectedly, Imotrust 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 Imotrust will offset losses from the drop in Imotrust's long position.| Digi Communications vs. Teraplast Bist | Digi Communications vs. Electroarges S | Digi Communications vs. Comvex SA | Digi Communications vs. Feper SA |
| Imotrust vs. TRANSILVANIA INVESTMENTS ALLIANCE | Imotrust vs. Biofarm Bucure | Imotrust vs. Evergent Investments SA | Imotrust vs. Erste Group Bank |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |