Correlation Between Global Engine and Digimarc
Can any of the company-specific risk be diversified away by investing in both Global Engine and Digimarc 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 Global Engine and Digimarc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Engine Group and Digimarc, you can compare the effects of market volatilities on Global Engine and Digimarc 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 Global Engine with a short position of Digimarc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Engine and Digimarc.
Diversification Opportunities for Global Engine and Digimarc
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Global and Digimarc is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Global Engine Group and Digimarc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digimarc and Global Engine 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 Global Engine Group are associated (or correlated) with Digimarc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digimarc has no effect on the direction of Global Engine i.e., Global Engine and Digimarc go up and down completely randomly.
Pair Corralation between Global Engine and Digimarc
Considering the 90-day investment horizon Global Engine Group is expected to generate 2.4 times more return on investment than Digimarc. However, Global Engine is 2.4 times more volatile than Digimarc. It trades about 0.03 of its potential returns per unit of risk. Digimarc is currently generating about -0.38 per unit of risk. If you would invest 176.00 in Global Engine Group on January 4, 2025 and sell it today you would lose (3.00) from holding Global Engine Group or give up 1.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Engine Group vs. Digimarc
Performance |
| Timeline |
| Global Engine Group |
| Digimarc |
Global Engine and Digimarc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Engine and Digimarc
The main advantage of trading using opposite Global Engine and Digimarc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Engine position performs unexpectedly, Digimarc 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 Digimarc will offset losses from the drop in Digimarc's long position.| Global Engine vs. Dave Busters Entertainment | Global Engine vs. SkyCity Entertainment Group | Global Engine vs. JD Sports Fashion | Global Engine vs. Streamline Health Solutions |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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