Correlation Between DigiAsia Corp and Cognyte Software
Can any of the company-specific risk be diversified away by investing in both DigiAsia Corp and Cognyte Software 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 Cognyte Software into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DigiAsia Corp and Cognyte Software, you can compare the effects of market volatilities on DigiAsia Corp and Cognyte Software 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 Cognyte Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of DigiAsia Corp and Cognyte Software.
Diversification Opportunities for DigiAsia Corp and Cognyte Software
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DigiAsia and Cognyte is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding DigiAsia Corp and Cognyte Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cognyte Software 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 Cognyte Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cognyte Software has no effect on the direction of DigiAsia Corp i.e., DigiAsia Corp and Cognyte Software go up and down completely randomly.
Pair Corralation between DigiAsia Corp and Cognyte Software
Given the investment horizon of 90 days DigiAsia Corp is expected to generate 4.56 times more return on investment than Cognyte Software. However, DigiAsia Corp is 4.56 times more volatile than Cognyte Software. It trades about 0.07 of its potential returns per unit of risk. Cognyte Software is currently generating about 0.16 per unit of risk. If you would invest 58.00 in DigiAsia Corp on October 26, 2024 and sell it today you would earn a total of 2.18 from holding DigiAsia Corp or generate 3.76% 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. Cognyte Software
Performance |
| Timeline |
| DigiAsia Corp |
| Cognyte Software |
DigiAsia Corp and Cognyte Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DigiAsia Corp and Cognyte Software
The main advantage of trading using opposite DigiAsia Corp and Cognyte Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DigiAsia Corp position performs unexpectedly, Cognyte Software 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 Cognyte Software will offset losses from the drop in Cognyte Software's long position.| DigiAsia Corp vs. Ameriprise Financial | DigiAsia Corp vs. Aldel Financial II | DigiAsia Corp vs. Starwin Media Holdings | DigiAsia Corp vs. Small Cap Premium |
| Cognyte Software vs. CSG Systems International | Cognyte Software vs. Evertec | Cognyte Software vs. Varonis Systems | Cognyte Software vs. Radware |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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