Correlation Between TRADEDOUBLER and DATANG INTL
Can any of the company-specific risk be diversified away by investing in both TRADEDOUBLER and DATANG INTL 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 TRADEDOUBLER and DATANG INTL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TRADEDOUBLER AB SK and DATANG INTL POW, you can compare the effects of market volatilities on TRADEDOUBLER and DATANG INTL 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 TRADEDOUBLER with a short position of DATANG INTL. Check out your portfolio center. Please also check ongoing floating volatility patterns of TRADEDOUBLER and DATANG INTL.
Diversification Opportunities for TRADEDOUBLER and DATANG INTL
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between TRADEDOUBLER and DATANG is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding TRADEDOUBLER AB SK and DATANG INTL POW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DATANG INTL POW and TRADEDOUBLER 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 TRADEDOUBLER AB SK are associated (or correlated) with DATANG INTL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DATANG INTL POW has no effect on the direction of TRADEDOUBLER i.e., TRADEDOUBLER and DATANG INTL go up and down completely randomly.
Pair Corralation between TRADEDOUBLER and DATANG INTL
Assuming the 90 days horizon TRADEDOUBLER AB SK is expected to under-perform the DATANG INTL. But the stock apears to be less risky and, when comparing its historical volatility, TRADEDOUBLER AB SK is 1.04 times less risky than DATANG INTL. The stock trades about 0.0 of its potential returns per unit of risk. The DATANG INTL POW is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 13.00 in DATANG INTL POW on September 12, 2024 and sell it today you would earn a total of 4.00 from holding DATANG INTL POW or generate 30.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TRADEDOUBLER AB SK vs. DATANG INTL POW
Performance |
| Timeline |
| TRADEDOUBLER AB SK |
| DATANG INTL POW |
TRADEDOUBLER and DATANG INTL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TRADEDOUBLER and DATANG INTL
The main advantage of trading using opposite TRADEDOUBLER and DATANG INTL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TRADEDOUBLER position performs unexpectedly, DATANG INTL 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 DATANG INTL will offset losses from the drop in DATANG INTL's long position.| TRADEDOUBLER vs. Superior Plus Corp | TRADEDOUBLER vs. SIVERS SEMICONDUCTORS AB | TRADEDOUBLER vs. NorAm Drilling AS | TRADEDOUBLER vs. Norsk Hydro ASA |
| DATANG INTL vs. Apple Inc | DATANG INTL vs. Apple Inc | DATANG INTL vs. Apple Inc | DATANG INTL vs. Apple Inc |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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