Correlation Between DNXcorp and Vente Unique

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

By analyzing existing cross correlation between DNXcorp and Vente Unique, you can compare the effects of market volatilities on DNXcorp and Vente Unique 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 DNXcorp with a short position of Vente Unique. Check out your portfolio center. Please also check ongoing floating volatility patterns of DNXcorp and Vente Unique.

Diversification Opportunities for DNXcorp and Vente Unique

0.13

Correlation Coefficient

DNXcorp  Vente Unique

Average diversification

The 3 months correlation between DNXcorp and Vente is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding DNXcorp and Vente Unique in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vente Unique and DNXcorp 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 DNXcorp are associated (or correlated) with Vente Unique. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vente Unique has no effect on the direction of DNXcorp i.e., DNXcorp and Vente Unique go up and down completely randomly.

Pair Corralation between DNXcorp and Vente Unique

Assuming the 90 days trading horizon DNXcorp is expected to generate 0.99 times more return on investment than Vente Unique. However, DNXcorp is 1.01 times less risky than Vente Unique. It trades about 0.1 of its potential returns per unit of risk. Vente Unique is currently generating about -0.08 per unit of risk. If you would invest  1,630  in DNXcorp on December 5, 2024 and sell it today you would earn a total of  165.00  from holding DNXcorp or generate 10.12% return on investment over 90 days.

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

DNXcorp  vs.  Vente Unique

DNXcorp

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in DNXcorp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, DNXcorp may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Vente Unique

Risk-Adjusted Performance

Very Weak

Over the last 90 days Vente Unique has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with DNXcorp and Vente Unique

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

The idea behind DNXcorp and Vente Unique 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.

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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.