Correlation Between DSG Global and Focus Universal
Can any of the company-specific risk be diversified away by investing in both DSG Global and Focus Universal 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 DSG Global and Focus Universal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DSG Global and Focus Universal, you can compare the effects of market volatilities on DSG Global and Focus Universal 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 DSG Global with a short position of Focus Universal. Check out your portfolio center. Please also check ongoing floating volatility patterns of DSG Global and Focus Universal.
Diversification Opportunities for DSG Global and Focus Universal
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between DSG and Focus is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding DSG Global and Focus Universal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Focus Universal and DSG Global 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 DSG Global are associated (or correlated) with Focus Universal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Focus Universal has no effect on the direction of DSG Global i.e., DSG Global and Focus Universal go up and down completely randomly.
Pair Corralation between DSG Global and Focus Universal
Given the investment horizon of 90 days DSG Global is expected to generate 55.32 times more return on investment than Focus Universal. However, DSG Global is 55.32 times more volatile than Focus Universal. It trades about 0.19 of its potential returns per unit of risk. Focus Universal is currently generating about -0.03 per unit of risk. If you would invest 0.01 in DSG Global on August 28, 2024 and sell it today you would earn a total of 0.00 from holding DSG Global or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
DSG Global vs. Focus Universal
Performance |
| Timeline |
| DSG Global |
| Focus Universal |
DSG Global and Focus Universal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DSG Global and Focus Universal
The main advantage of trading using opposite DSG Global and Focus Universal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DSG Global position performs unexpectedly, Focus Universal 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 Focus Universal will offset losses from the drop in Focus Universal's long position.| DSG Global vs. Garmin | DSG Global vs. Keysight Technologies | DSG Global vs. Fortive Corp | DSG Global vs. Teledyne Technologies Incorporated |
| Focus Universal vs. ESCO Technologies | Focus Universal vs. Genasys | Focus Universal vs. Cepton Inc | Focus Universal vs. Darkpulse |
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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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