Correlation Between Dixons Carphone and PointsBet Holdings
Can any of the company-specific risk be diversified away by investing in both Dixons Carphone and PointsBet Holdings 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 Dixons Carphone and PointsBet Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dixons Carphone plc and PointsBet Holdings Limited, you can compare the effects of market volatilities on Dixons Carphone and PointsBet Holdings 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 Dixons Carphone with a short position of PointsBet Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dixons Carphone and PointsBet Holdings.
Diversification Opportunities for Dixons Carphone and PointsBet Holdings
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Dixons and PointsBet is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Dixons Carphone plc and PointsBet Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PointsBet Holdings and Dixons Carphone 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 Dixons Carphone plc are associated (or correlated) with PointsBet Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PointsBet Holdings has no effect on the direction of Dixons Carphone i.e., Dixons Carphone and PointsBet Holdings go up and down completely randomly.
Pair Corralation between Dixons Carphone and PointsBet Holdings
Assuming the 90 days horizon Dixons Carphone plc is expected to under-perform the PointsBet Holdings. But the pink sheet apears to be less risky and, when comparing its historical volatility, Dixons Carphone plc is 6.79 times less risky than PointsBet Holdings. The pink sheet trades about -0.04 of its potential returns per unit of risk. The PointsBet Holdings Limited is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 30.00 in PointsBet Holdings Limited on August 28, 2024 and sell it today you would earn a total of 29.00 from holding PointsBet Holdings Limited or generate 96.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 60.94% |
| Values | Daily Returns |
Dixons Carphone plc vs. PointsBet Holdings Limited
Performance |
| Timeline |
| Dixons Carphone plc |
| PointsBet Holdings |
Dixons Carphone and PointsBet Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dixons Carphone and PointsBet Holdings
The main advantage of trading using opposite Dixons Carphone and PointsBet Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dixons Carphone position performs unexpectedly, PointsBet Holdings 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 PointsBet Holdings will offset losses from the drop in PointsBet Holdings' long position.| Dixons Carphone vs. Iridium Communications | Dixons Carphone vs. SBM Offshore NV | Dixons Carphone vs. Semtech | Dixons Carphone vs. Jutal Offshore Oil |
| PointsBet Holdings vs. Entain DRC PLC | PointsBet Holdings vs. 888 Holdings | PointsBet Holdings vs. Intema Solutions | PointsBet Holdings vs. Royal Wins |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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