Correlation Between DigitalOcean Holdings and Global Blue
Can any of the company-specific risk be diversified away by investing in both DigitalOcean Holdings and Global Blue 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 DigitalOcean Holdings and Global Blue into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DigitalOcean Holdings and Global Blue Group, you can compare the effects of market volatilities on DigitalOcean Holdings and Global Blue 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 DigitalOcean Holdings with a short position of Global Blue. Check out your portfolio center. Please also check ongoing floating volatility patterns of DigitalOcean Holdings and Global Blue.
Diversification Opportunities for DigitalOcean Holdings and Global Blue
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between DigitalOcean and Global is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding DigitalOcean Holdings and Global Blue Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Blue Group and DigitalOcean 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 DigitalOcean Holdings are associated (or correlated) with Global Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Blue Group has no effect on the direction of DigitalOcean Holdings i.e., DigitalOcean Holdings and Global Blue go up and down completely randomly.
Pair Corralation between DigitalOcean Holdings and Global Blue
Given the investment horizon of 90 days DigitalOcean Holdings is expected to generate 4.25 times less return on investment than Global Blue. But when comparing it to its historical volatility, DigitalOcean Holdings is 2.07 times less risky than Global Blue. It trades about 0.09 of its potential returns per unit of risk. Global Blue Group is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 546.00 in Global Blue Group on September 18, 2024 and sell it today you would earn a total of 91.00 from holding Global Blue Group or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DigitalOcean Holdings vs. Global Blue Group
Performance |
| Timeline |
| DigitalOcean Holdings |
| Global Blue Group |
DigitalOcean Holdings and Global Blue Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DigitalOcean Holdings and Global Blue
The main advantage of trading using opposite DigitalOcean Holdings and Global Blue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DigitalOcean Holdings position performs unexpectedly, Global Blue 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 Global Blue will offset losses from the drop in Global Blue's long position.| DigitalOcean Holdings vs. Crowdstrike Holdings | DigitalOcean Holdings vs. Zscaler | DigitalOcean Holdings vs. Okta Inc | DigitalOcean Holdings vs. Uipath Inc |
| Global Blue vs. Evertec | Global Blue vs. NetScout Systems | Global Blue vs. CSG Systems International | Global Blue vs. Tenable Holdings |
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 Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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