Correlation Between Dug Technology and Eureka Group
Can any of the company-specific risk be diversified away by investing in both Dug Technology and Eureka 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 Dug Technology and Eureka Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dug Technology and Eureka Group Holdings, you can compare the effects of market volatilities on Dug Technology and Eureka 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 Dug Technology with a short position of Eureka Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dug Technology and Eureka Group.
Diversification Opportunities for Dug Technology and Eureka Group
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Dug and Eureka is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Dug Technology and Eureka Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eureka Group Holdings 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 Eureka Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eureka Group Holdings has no effect on the direction of Dug Technology i.e., Dug Technology and Eureka Group go up and down completely randomly.
Pair Corralation between Dug Technology and Eureka Group
Assuming the 90 days trading horizon Dug Technology is expected to generate 1.57 times more return on investment than Eureka Group. However, Dug Technology is 1.57 times more volatile than Eureka Group Holdings. It trades about 0.05 of its potential returns per unit of risk. Eureka Group Holdings is currently generating about 0.05 per unit of risk. If you would invest 100.00 in Dug Technology on August 27, 2024 and sell it today you would earn a total of 51.00 from holding Dug Technology or generate 51.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dug Technology vs. Eureka Group Holdings
Performance |
| Timeline |
| Dug Technology |
| Eureka Group Holdings |
Dug Technology and Eureka Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dug Technology and Eureka Group
The main advantage of trading using opposite Dug Technology and Eureka Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dug Technology position performs unexpectedly, Eureka 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 Eureka Group will offset losses from the drop in Eureka Group's long position.| Dug Technology vs. Westpac Banking | Dug Technology vs. Ecofibre | Dug Technology vs. iShares Global Healthcare | Dug Technology vs. Adriatic Metals Plc |
| Eureka Group vs. Lendlease Group | Eureka Group vs. Dug Technology | Eureka Group vs. Qbe Insurance Group | Eureka Group vs. Magellan Financial Group |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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