Correlation Between Dimand SA and Performance Technologies
Can any of the company-specific risk be diversified away by investing in both Dimand SA and Performance Technologies 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 Dimand SA and Performance Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dimand SA and Performance Technologies SA, you can compare the effects of market volatilities on Dimand SA and Performance Technologies 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 Dimand SA with a short position of Performance Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dimand SA and Performance Technologies.
Diversification Opportunities for Dimand SA and Performance Technologies
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dimand and Performance is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Dimand SA and Performance Technologies SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Performance Technologies and Dimand SA 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 Dimand SA are associated (or correlated) with Performance Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Performance Technologies has no effect on the direction of Dimand SA i.e., Dimand SA and Performance Technologies go up and down completely randomly.
Pair Corralation between Dimand SA and Performance Technologies
Assuming the 90 days trading horizon Dimand SA is expected to under-perform the Performance Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Dimand SA is 1.89 times less risky than Performance Technologies. The stock trades about -0.1 of its potential returns per unit of risk. The Performance Technologies SA is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 450.00 in Performance Technologies SA on August 31, 2024 and sell it today you would earn a total of 84.00 from holding Performance Technologies SA or generate 18.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dimand SA vs. Performance Technologies SA
Performance |
| Timeline |
| Dimand SA |
| Performance Technologies |
Dimand SA and Performance Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dimand SA and Performance Technologies
The main advantage of trading using opposite Dimand SA and Performance Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dimand SA position performs unexpectedly, Performance Technologies 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 Performance Technologies will offset losses from the drop in Performance Technologies' long position.| Dimand SA vs. Intertech SA Inter | Dimand SA vs. Profile Systems Software | Dimand SA vs. Optronics Technologies SA | Dimand SA vs. Interlife General Insurance |
| Performance Technologies vs. Quest Holdings SA | Performance Technologies vs. CPI Computer Peripherals | Performance Technologies vs. National Bank of | Performance Technologies vs. EL D Mouzakis |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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