Correlation Between Dimension Computer and Group Up
Can any of the company-specific risk be diversified away by investing in both Dimension Computer and Group Up 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 Dimension Computer and Group Up into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dimension Computer Technology and Group Up Industrial, you can compare the effects of market volatilities on Dimension Computer and Group Up 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 Dimension Computer with a short position of Group Up. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dimension Computer and Group Up.
Diversification Opportunities for Dimension Computer and Group Up
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Dimension and Group is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Dimension Computer Technology and Group Up Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Group Up Industrial and Dimension Computer 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 Dimension Computer Technology are associated (or correlated) with Group Up. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Group Up Industrial has no effect on the direction of Dimension Computer i.e., Dimension Computer and Group Up go up and down completely randomly.
Pair Corralation between Dimension Computer and Group Up
Assuming the 90 days trading horizon Dimension Computer is expected to generate 1.68 times less return on investment than Group Up. In addition to that, Dimension Computer is 1.12 times more volatile than Group Up Industrial. It trades about 0.05 of its total potential returns per unit of risk. Group Up Industrial is currently generating about 0.09 per unit of volatility. If you would invest 9,065 in Group Up Industrial on September 20, 2024 and sell it today you would earn a total of 15,235 from holding Group Up Industrial or generate 168.06% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 99.79% |
Values | Daily Returns |
Dimension Computer Technology vs. Group Up Industrial
Performance |
Timeline |
Dimension Computer |
Group Up Industrial |
Dimension Computer and Group Up Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dimension Computer and Group Up
The main advantage of trading using opposite Dimension Computer and Group Up positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dimension Computer position performs unexpectedly, Group Up 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 Group Up will offset losses from the drop in Group Up's long position.Dimension Computer vs. Niching Industrial | Dimension Computer vs. Kworld Computer Co | Dimension Computer vs. Ruentex Development Co | Dimension Computer vs. Symtek Automation Asia |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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