Correlation Between Data Storage and VNET Group
Can any of the company-specific risk be diversified away by investing in both Data Storage and VNET Group 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 Data Storage and VNET Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Data Storage Corp and VNET Group DRC, you can compare the effects of market volatilities on Data Storage and VNET Group 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 Data Storage with a short position of VNET Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Data Storage and VNET Group.
Diversification Opportunities for Data Storage and VNET Group
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Data and VNET is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Data Storage Corp and VNET Group DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VNET Group DRC and Data Storage 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 Data Storage Corp are associated (or correlated) with VNET Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VNET Group DRC has no effect on the direction of Data Storage i.e., Data Storage and VNET Group go up and down completely randomly.
Pair Corralation between Data Storage and VNET Group
Given the investment horizon of 90 days Data Storage Corp is expected to generate 0.86 times more return on investment than VNET Group. However, Data Storage Corp is 1.17 times less risky than VNET Group. It trades about 0.06 of its potential returns per unit of risk. VNET Group DRC is currently generating about 0.01 per unit of risk. If you would invest 178.00 in Data Storage Corp on August 29, 2024 and sell it today you would earn a total of 212.00 from holding Data Storage Corp or generate 119.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Data Storage Corp vs. VNET Group DRC
Performance |
| Timeline |
| Data Storage Corp |
| VNET Group DRC |
Data Storage and VNET Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Data Storage and VNET Group
The main advantage of trading using opposite Data Storage and VNET Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Data Storage position performs unexpectedly, VNET Group 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 VNET Group will offset losses from the drop in VNET Group's long position.| Data Storage vs. Cognizant Technology Solutions | Data Storage vs. WNS Holdings | Data Storage vs. CLARIVATE PLC | Data Storage vs. Broadridge Financial Solutions |
| VNET Group vs. CLARIVATE PLC | VNET Group vs. WNS Holdings | VNET Group vs. GDS Holdings | VNET Group vs. CACI International |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |