Correlation Between Dixons Carphone and RadNet
Can any of the company-specific risk be diversified away by investing in both Dixons Carphone and RadNet 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 RadNet 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 RadNet Inc, you can compare the effects of market volatilities on Dixons Carphone and RadNet 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 RadNet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dixons Carphone and RadNet.
Diversification Opportunities for Dixons Carphone and RadNet
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dixons and RadNet is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Dixons Carphone plc and RadNet Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RadNet Inc 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 RadNet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RadNet Inc has no effect on the direction of Dixons Carphone i.e., Dixons Carphone and RadNet go up and down completely randomly.
Pair Corralation between Dixons Carphone and RadNet
Assuming the 90 days horizon Dixons Carphone plc is expected to under-perform the RadNet. But the pink sheet apears to be less risky and, when comparing its historical volatility, Dixons Carphone plc is 2.67 times less risky than RadNet. The pink sheet trades about -0.23 of its potential returns per unit of risk. The RadNet Inc is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 6,799 in RadNet Inc on September 5, 2024 and sell it today you would earn a total of 1,265 from holding RadNet Inc or generate 18.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dixons Carphone plc vs. RadNet Inc
Performance |
| Timeline |
| Dixons Carphone plc |
| RadNet Inc |
Dixons Carphone and RadNet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dixons Carphone and RadNet
The main advantage of trading using opposite Dixons Carphone and RadNet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dixons Carphone position performs unexpectedly, RadNet 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 RadNet will offset losses from the drop in RadNet's long position.| Dixons Carphone vs. RadNet Inc | Dixons Carphone vs. Waters | Dixons Carphone vs. Valneva SE ADR | Dixons Carphone vs. Paiute Oil Mining |
| RadNet vs. Sotera Health Co | RadNet vs. Neogen | RadNet vs. Myriad Genetics | RadNet vs. bioAffinity Technologies Warrant |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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