Correlation Between Dotdigital Group and Maptelligent
Can any of the company-specific risk be diversified away by investing in both Dotdigital Group and Maptelligent 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 Dotdigital Group and Maptelligent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between dotdigital Group Plc and Maptelligent, you can compare the effects of market volatilities on Dotdigital Group and Maptelligent 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 Dotdigital Group with a short position of Maptelligent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dotdigital Group and Maptelligent.
Diversification Opportunities for Dotdigital Group and Maptelligent
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dotdigital and Maptelligent is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding dotdigital Group Plc and Maptelligent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maptelligent and Dotdigital Group 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 dotdigital Group Plc are associated (or correlated) with Maptelligent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maptelligent has no effect on the direction of Dotdigital Group i.e., Dotdigital Group and Maptelligent go up and down completely randomly.
Pair Corralation between Dotdigital Group and Maptelligent
Assuming the 90 days horizon dotdigital Group Plc is expected to generate 0.13 times more return on investment than Maptelligent. However, dotdigital Group Plc is 7.47 times less risky than Maptelligent. It trades about -0.04 of its potential returns per unit of risk. Maptelligent is currently generating about -0.21 per unit of risk. If you would invest 123.00 in dotdigital Group Plc on September 13, 2024 and sell it today you would lose (3.00) from holding dotdigital Group Plc or give up 2.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
dotdigital Group Plc vs. Maptelligent
Performance |
| Timeline |
| dotdigital Group Plc |
| Maptelligent |
Dotdigital Group and Maptelligent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dotdigital Group and Maptelligent
The main advantage of trading using opposite Dotdigital Group and Maptelligent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dotdigital Group position performs unexpectedly, Maptelligent 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 Maptelligent will offset losses from the drop in Maptelligent's long position.| Dotdigital Group vs. TrackX Holdings | Dotdigital Group vs. Generative AI Solutions | Dotdigital Group vs. eGain | Dotdigital Group vs. Marin Software |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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