Correlation Between DigiAsia Corp and VHAI
Can any of the company-specific risk be diversified away by investing in both DigiAsia Corp and VHAI 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 VHAI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DigiAsia Corp and VHAI, you can compare the effects of market volatilities on DigiAsia Corp and VHAI 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 VHAI. Check out your portfolio center. Please also check ongoing floating volatility patterns of DigiAsia Corp and VHAI.
Diversification Opportunities for DigiAsia Corp and VHAI
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DigiAsia and VHAI is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding DigiAsia Corp and VHAI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VHAI 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 VHAI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VHAI has no effect on the direction of DigiAsia Corp i.e., DigiAsia Corp and VHAI go up and down completely randomly.
Pair Corralation between DigiAsia Corp and VHAI
Given the investment horizon of 90 days DigiAsia Corp is expected to generate 0.99 times more return on investment than VHAI. However, DigiAsia Corp is 1.01 times less risky than VHAI. It trades about 0.01 of its potential returns per unit of risk. VHAI is currently generating about -0.25 per unit of risk. If you would invest 818.00 in DigiAsia Corp on March 31, 2024 and sell it today you would lose (256.00) from holding DigiAsia Corp or give up 31.3% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
DigiAsia Corp vs. VHAI
Performance |
Timeline |
DigiAsia Corp |
VHAI |
DigiAsia Corp and VHAI Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with DigiAsia Corp and VHAI
The main advantage of trading using opposite DigiAsia Corp and VHAI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DigiAsia Corp position performs unexpectedly, VHAI 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 VHAI will offset losses from the drop in VHAI's long position.DigiAsia Corp vs. SentinelOne | DigiAsia Corp vs. BlackBerry | DigiAsia Corp vs. Global Blue Group | DigiAsia Corp vs. Aurora Mobile |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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