Correlation Between Blackboxstocks and Dubber

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

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

Diversification Opportunities for Blackboxstocks and Dubber

0.02

Correlation Coefficient

Blackboxstocks  Dubber

Significant diversification

The 3 months correlation between Blackboxstocks and Dubber is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Blackboxstocks and Dubber Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dubber Limited and Blackboxstocks 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 Blackboxstocks are associated (or correlated) with Dubber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dubber Limited has no effect on the direction of Blackboxstocks i.e., Blackboxstocks and Dubber go up and down completely randomly.

Pair Corralation between Blackboxstocks and Dubber

Given the investment horizon of 90 days Blackboxstocks is expected to under-perform the Dubber. But the stock apears to be less risky and, when comparing its historical volatility, Blackboxstocks is 10.53 times less risky than Dubber. The stock trades about -0.01 of its potential returns per unit of risk. The Dubber Limited is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  17.00  in Dubber Limited on September 28, 2024 and sell it today you would lose (14.50) from holding Dubber Limited or give up 85.29% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	99.7%
Values	Daily Returns

Blackboxstocks  vs.  Dubber Limited

Blackboxstocks

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackboxstocks has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fragile performance in the last few months, the Stock's fundamental drivers remain fairly strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Dubber Limited

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Dubber Limited are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal basic indicators, Dubber reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Blackboxstocks and Dubber

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

The idea behind Blackboxstocks and Dubber Limited 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.