Correlation Between I Jang and Dimerco Data

Can any of the company-specific risk be diversified away by investing in both I Jang and Dimerco Data 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 I Jang and Dimerco Data into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between I Jang Industrial and Dimerco Data System, you can compare the effects of market volatilities on I Jang and Dimerco Data 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 I Jang with a short position of Dimerco Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of I Jang and Dimerco Data.

Diversification Opportunities for I Jang and Dimerco Data

-0.16

Correlation Coefficient

I Jang  Dimerco Data

Good diversification

The 3 months correlation between 8342 and Dimerco is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding I Jang Industrial and Dimerco Data System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dimerco Data System and I Jang 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 I Jang Industrial are associated (or correlated) with Dimerco Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dimerco Data System has no effect on the direction of I Jang i.e., I Jang and Dimerco Data go up and down completely randomly.

Pair Corralation between I Jang and Dimerco Data

Assuming the 90 days trading horizon I Jang Industrial is expected to under-perform the Dimerco Data. But the stock apears to be less risky and, when comparing its historical volatility, I Jang Industrial is 1.11 times less risky than Dimerco Data. The stock trades about -0.04 of its potential returns per unit of risk. The Dimerco Data System is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  11,800  in Dimerco Data System on December 24, 2024 and sell it today you would earn a total of  1,450  from holding Dimerco Data System or generate 12.29% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

I Jang Industrial  vs.  Dimerco Data System

I Jang Industrial

Risk-Adjusted Performance

Very Weak

Over the last 90 days I Jang Industrial has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, I Jang is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Dimerco Data System

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dimerco Data System are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Dimerco Data showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with I Jang and Dimerco Data

The main advantage of trading using opposite I Jang and Dimerco Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if I Jang position performs unexpectedly, Dimerco Data 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 Dimerco Data will offset losses from the drop in Dimerco Data's long position.

The idea behind I Jang Industrial and Dimerco Data System 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.