Correlation Between DLH Holdings and CSG Systems
Can any of the company-specific risk be diversified away by investing in both DLH Holdings and CSG Systems 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 DLH Holdings and CSG Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DLH Holdings Corp and CSG Systems International, you can compare the effects of market volatilities on DLH Holdings and CSG Systems 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 DLH Holdings with a short position of CSG Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of DLH Holdings and CSG Systems.
Diversification Opportunities for DLH Holdings and CSG Systems
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DLH and CSG is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding DLH Holdings Corp and CSG Systems International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSG Systems International and DLH 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 DLH Holdings Corp are associated (or correlated) with CSG Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSG Systems International has no effect on the direction of DLH Holdings i.e., DLH Holdings and CSG Systems go up and down completely randomly.
Pair Corralation between DLH Holdings and CSG Systems
Given the investment horizon of 90 days DLH Holdings Corp is expected to under-perform the CSG Systems. In addition to that, DLH Holdings is 1.39 times more volatile than CSG Systems International. It trades about -0.02 of its total potential returns per unit of risk. CSG Systems International is currently generating about 0.01 per unit of volatility. If you would invest 5,397 in CSG Systems International on August 30, 2024 and sell it today you would earn a total of 62.00 from holding CSG Systems International or generate 1.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
DLH Holdings Corp vs. CSG Systems International
Performance |
| Timeline |
| DLH Holdings Corp |
| CSG Systems International |
DLH Holdings and CSG Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DLH Holdings and CSG Systems
The main advantage of trading using opposite DLH Holdings and CSG Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DLH Holdings position performs unexpectedly, CSG Systems 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 CSG Systems will offset losses from the drop in CSG Systems' long position.| DLH Holdings vs. Manhattan Associates | DLH Holdings vs. Paycom Soft | DLH Holdings vs. Clearwater Analytics Holdings | DLH Holdings vs. Procore Technologies |
| CSG Systems vs. Oneconnect Financial Technology | CSG Systems vs. Global Business Travel | CSG Systems vs. Alight Inc | CSG Systems vs. CS Disco LLC |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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