Correlation Between Dicker Data and Data#3

Can any of the company-specific risk be diversified away by investing in both Dicker Data and Data#3 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 Dicker Data and Data#3 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dicker Data and Data3, you can compare the effects of market volatilities on Dicker Data and Data#3 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 Dicker Data with a short position of Data#3. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dicker Data and Data#3.

Diversification Opportunities for Dicker Data and Data#3

0.53

Correlation Coefficient

Dicker Data  Data#3

Very weak diversification

The 3 months correlation between Dicker and Data#3 is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Dicker Data and Data3 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data#3 and Dicker Data 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 Dicker Data are associated (or correlated) with Data#3. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data#3 has no effect on the direction of Dicker Data i.e., Dicker Data and Data#3 go up and down completely randomly.

Pair Corralation between Dicker Data and Data#3

Assuming the 90 days trading horizon Dicker Data is expected to generate 26.99 times less return on investment than Data#3. In addition to that, Dicker Data is 1.11 times more volatile than Data3. It trades about 0.0 of its total potential returns per unit of risk. Data3 is currently generating about 0.13 per unit of volatility. If you would invest  629.00  in Data3 on December 30, 2024 and sell it today you would earn a total of  88.00  from holding Data3 or generate 13.99% return on investment over 90 days.

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

Dicker Data  vs.  Data3

Dicker Data

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dicker Data has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Dicker Data is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Data#3

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Data3 are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain essential indicators, Data#3 unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Dicker Data and Data#3

The main advantage of trading using opposite Dicker Data and Data#3 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dicker Data position performs unexpectedly, Data#3 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 Data#3 will offset losses from the drop in Data#3's long position.

The idea behind Dicker Data and Data3 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..