Correlation Between Ditto Public and Asia Precision
Can any of the company-specific risk be diversified away by investing in both Ditto Public and Asia Precision 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 Ditto Public and Asia Precision into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ditto Public and Asia Precision Public, you can compare the effects of market volatilities on Ditto Public and Asia Precision 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 Ditto Public with a short position of Asia Precision. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ditto Public and Asia Precision.
Diversification Opportunities for Ditto Public and Asia Precision
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ditto and Asia is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Ditto Public and Asia Precision Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Precision Public and Ditto Public 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 Ditto Public are associated (or correlated) with Asia Precision. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Precision Public has no effect on the direction of Ditto Public i.e., Ditto Public and Asia Precision go up and down completely randomly.
Pair Corralation between Ditto Public and Asia Precision
Assuming the 90 days trading horizon Ditto Public is expected to under-perform the Asia Precision. But the stock apears to be less risky and, when comparing its historical volatility, Ditto Public is 15.88 times less risky than Asia Precision. The stock trades about -0.05 of its potential returns per unit of risk. The Asia Precision Public is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 438.00 in Asia Precision Public on September 1, 2024 and sell it today you would lose (251.00) from holding Asia Precision Public or give up 57.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ditto Public vs. Asia Precision Public
Performance |
| Timeline |
| Ditto Public |
| Asia Precision Public |
Ditto Public and Asia Precision Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ditto Public and Asia Precision
The main advantage of trading using opposite Ditto Public and Asia Precision positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ditto Public position performs unexpectedly, Asia Precision 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 Asia Precision will offset losses from the drop in Asia Precision's long position.| Ditto Public vs. Dohome Public | Ditto Public vs. Beryl 8 Plus | Ditto Public vs. Forth Public | Ditto Public vs. Delta Electronics Public |
| Asia Precision vs. AJ Plast Public | Asia Precision vs. AAPICO Hitech Public | Asia Precision vs. Asian Sea | Asia Precision vs. Alucon Public |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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