Correlation Between DigiAsia Corp and Strats SM
Can any of the company-specific risk be diversified away by investing in both DigiAsia Corp and Strats SM 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 Strats SM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DigiAsia Corp and Strats SM Trust, you can compare the effects of market volatilities on DigiAsia Corp and Strats SM 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 Strats SM. Check out your portfolio center. Please also check ongoing floating volatility patterns of DigiAsia Corp and Strats SM.
Diversification Opportunities for DigiAsia Corp and Strats SM
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between DigiAsia and Strats is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding DigiAsia Corp and Strats SM Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strats SM Trust 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 Strats SM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strats SM Trust has no effect on the direction of DigiAsia Corp i.e., DigiAsia Corp and Strats SM go up and down completely randomly.
Pair Corralation between DigiAsia Corp and Strats SM
Given the investment horizon of 90 days DigiAsia Corp is expected to generate 29.47 times more return on investment than Strats SM. However, DigiAsia Corp is 29.47 times more volatile than Strats SM Trust. It trades about 0.03 of its potential returns per unit of risk. Strats SM Trust is currently generating about 0.07 per unit of risk. If you would invest 59.00 in DigiAsia Corp on November 3, 2024 and sell it today you would lose (11.00) from holding DigiAsia Corp or give up 18.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 97.56% |
| Values | Daily Returns |
DigiAsia Corp vs. Strats SM Trust
Performance |
| Timeline |
| DigiAsia Corp |
| Strats SM Trust |
DigiAsia Corp and Strats SM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DigiAsia Corp and Strats SM
The main advantage of trading using opposite DigiAsia Corp and Strats SM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DigiAsia Corp position performs unexpectedly, Strats SM 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 Strats SM will offset losses from the drop in Strats SM's long position.| DigiAsia Corp vs. Udemy Inc | DigiAsia Corp vs. Cheche Group Class | DigiAsia Corp vs. Arrow Electronics | DigiAsia Corp vs. GMO Internet |
| Strats SM vs. STRATS SM Trust | Strats SM vs. STRATSSM Certificates series | Strats SM vs. SYNTHETIC FIXED INCOME | Strats SM vs. Strats SM Trust |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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