Correlation Between Centrifuge and DKargo
Can any of the company-specific risk be diversified away by investing in both Centrifuge and DKargo 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 Centrifuge and DKargo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centrifuge and dKargo, you can compare the effects of market volatilities on Centrifuge and DKargo 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 Centrifuge with a short position of DKargo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centrifuge and DKargo.
Diversification Opportunities for Centrifuge and DKargo
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Centrifuge and DKargo is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Centrifuge and dKargo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on dKargo and Centrifuge 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 Centrifuge are associated (or correlated) with DKargo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of dKargo has no effect on the direction of Centrifuge i.e., Centrifuge and DKargo go up and down completely randomly.
Pair Corralation between Centrifuge and DKargo
Assuming the 90 days trading horizon Centrifuge is expected to generate 1.21 times more return on investment than DKargo. However, Centrifuge is 1.21 times more volatile than dKargo. It trades about 0.07 of its potential returns per unit of risk. dKargo is currently generating about 0.02 per unit of risk. If you would invest 27.00 in Centrifuge on January 30, 2024 and sell it today you would earn a total of 41.00 from holding Centrifuge or generate 151.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Centrifuge vs. dKargo
Performance |
Timeline |
Centrifuge |
dKargo |
Centrifuge and DKargo Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Centrifuge and DKargo
The main advantage of trading using opposite Centrifuge and DKargo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centrifuge position performs unexpectedly, DKargo 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 DKargo will offset losses from the drop in DKargo's long position.The idea behind Centrifuge and dKargo pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
Other Complementary Tools
Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
Fundamental Analysis View fundamental data based on most recent published financial statements | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |