Correlation Between DINE SAB and Applied Materials
Can any of the company-specific risk be diversified away by investing in both DINE SAB and Applied Materials 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 DINE SAB and Applied Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DINE SAB de and Applied Materials, you can compare the effects of market volatilities on DINE SAB and Applied Materials 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 DINE SAB with a short position of Applied Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of DINE SAB and Applied Materials.
Diversification Opportunities for DINE SAB and Applied Materials
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between DINE and Applied is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding DINE SAB de and Applied Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Applied Materials and DINE SAB 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 DINE SAB de are associated (or correlated) with Applied Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Applied Materials has no effect on the direction of DINE SAB i.e., DINE SAB and Applied Materials go up and down completely randomly.
Pair Corralation between DINE SAB and Applied Materials
If you would invest 2,400 in DINE SAB de on September 12, 2024 and sell it today you would earn a total of 0.00 from holding DINE SAB de or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
DINE SAB de vs. Applied Materials
Performance |
| Timeline |
| DINE SAB de |
| Applied Materials |
DINE SAB and Applied Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DINE SAB and Applied Materials
The main advantage of trading using opposite DINE SAB and Applied Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DINE SAB position performs unexpectedly, Applied Materials 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 Applied Materials will offset losses from the drop in Applied Materials' long position.| DINE SAB vs. Verizon Communications | DINE SAB vs. DXC Technology | DINE SAB vs. United Airlines Holdings | DINE SAB vs. Hoteles City Express |
| Applied Materials vs. The Select Sector | Applied Materials vs. Promotora y Operadora | Applied Materials vs. iShares Global Timber | Applied Materials vs. SPDR Series Trust |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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