Correlation Between DigiAsia Corp and Bakkt Holdings
Can any of the company-specific risk be diversified away by investing in both DigiAsia Corp and Bakkt 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 DigiAsia Corp and Bakkt Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DigiAsia Corp and Bakkt Holdings, you can compare the effects of market volatilities on DigiAsia Corp and Bakkt 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 DigiAsia Corp with a short position of Bakkt Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of DigiAsia Corp and Bakkt Holdings.
Diversification Opportunities for DigiAsia Corp and Bakkt Holdings
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DigiAsia and Bakkt is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding DigiAsia Corp and Bakkt Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bakkt Holdings and DigiAsia Corp 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 DigiAsia Corp are associated (or correlated) with Bakkt Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bakkt Holdings has no effect on the direction of DigiAsia Corp i.e., DigiAsia Corp and Bakkt Holdings go up and down completely randomly.
Pair Corralation between DigiAsia Corp and Bakkt Holdings
Given the investment horizon of 90 days DigiAsia Corp is expected to under-perform the Bakkt Holdings. But the stock apears to be less risky and, when comparing its historical volatility, DigiAsia Corp is 3.31 times less risky than Bakkt Holdings. The stock trades about -0.3 of its potential returns per unit of risk. The Bakkt Holdings is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,103 in Bakkt Holdings on August 25, 2024 and sell it today you would earn a total of 1,830 from holding Bakkt Holdings or generate 165.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DigiAsia Corp vs. Bakkt Holdings
Performance |
| Timeline |
| DigiAsia Corp |
| Bakkt Holdings |
DigiAsia Corp and Bakkt Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DigiAsia Corp and Bakkt Holdings
The main advantage of trading using opposite DigiAsia Corp and Bakkt Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DigiAsia Corp position performs unexpectedly, Bakkt 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 Bakkt Holdings will offset losses from the drop in Bakkt Holdings' long position.| DigiAsia Corp vs. Evertec | DigiAsia Corp vs. Couchbase | DigiAsia Corp vs. i3 Verticals | DigiAsia Corp vs. EverCommerce |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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