Correlation Between Dug Technology and SPASX 200
Can any of the company-specific risk be diversified away by investing in both Dug Technology and SPASX 200 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 Dug Technology and SPASX 200 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dug Technology and SPASX 200 VIX, you can compare the effects of market volatilities on Dug Technology and SPASX 200 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 Dug Technology with a short position of SPASX 200. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dug Technology and SPASX 200.
Diversification Opportunities for Dug Technology and SPASX 200
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dug and SPASX is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Dug Technology and SPASX 200 VIX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPASX 200 VIX and Dug Technology 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 Dug Technology are associated (or correlated) with SPASX 200. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPASX 200 VIX has no effect on the direction of Dug Technology i.e., Dug Technology and SPASX 200 go up and down completely randomly.
Pair Corralation between Dug Technology and SPASX 200
Assuming the 90 days trading horizon Dug Technology is expected to under-perform the SPASX 200. But the stock apears to be less risky and, when comparing its historical volatility, Dug Technology is 2.4 times less risky than SPASX 200. The stock trades about -0.26 of its potential returns per unit of risk. The SPASX 200 VIX is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,223 in SPASX 200 VIX on September 12, 2024 and sell it today you would lose (178.00) from holding SPASX 200 VIX or give up 14.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
Dug Technology vs. SPASX 200 VIX
Performance |
| Timeline |
Dug Technology and SPASX 200 Volatility Contrast
Predicted Return Density |
| Returns |
Dug Technology
Pair trading matchups for Dug Technology
SPASX 200 VIX
Pair trading matchups for SPASX 200
Pair Trading with Dug Technology and SPASX 200
The main advantage of trading using opposite Dug Technology and SPASX 200 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dug Technology position performs unexpectedly, SPASX 200 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 SPASX 200 will offset losses from the drop in SPASX 200's long position.| Dug Technology vs. Aneka Tambang Tbk | Dug Technology vs. BHP Group Limited | Dug Technology vs. Commonwealth Bank | Dug Technology vs. Commonwealth Bank of |
| SPASX 200 vs. Farm Pride Foods | SPASX 200 vs. TPG Telecom | SPASX 200 vs. Chalice Mining Limited | SPASX 200 vs. Perseus Mining |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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