Correlation Between Dicker Data and Yancoal Australia

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

By analyzing existing cross correlation between Dicker Data and Yancoal Australia, you can compare the effects of market volatilities on Dicker Data and Yancoal Australia 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 Yancoal Australia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dicker Data and Yancoal Australia.

Diversification Opportunities for Dicker Data and Yancoal Australia

-0.5

Correlation Coefficient

Dicker Data  Yancoal Australia

Very good diversification

The 3 months correlation between Dicker and Yancoal is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Dicker Data and Yancoal Australia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yancoal Australia 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 Yancoal Australia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yancoal Australia has no effect on the direction of Dicker Data i.e., Dicker Data and Yancoal Australia go up and down completely randomly.

Pair Corralation between Dicker Data and Yancoal Australia

Assuming the 90 days trading horizon Dicker Data is expected to under-perform the Yancoal Australia. In addition to that, Dicker Data is 1.15 times more volatile than Yancoal Australia. It trades about -0.13 of its total potential returns per unit of risk. Yancoal Australia is currently generating about 0.12 per unit of volatility. If you would invest  613.00  in Yancoal Australia on October 8, 2024 and sell it today you would earn a total of  17.00  from holding Yancoal Australia or generate 2.77% return on investment over 90 days.

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

Dicker Data  vs.  Yancoal Australia

Dicker Data

Risk-Adjusted Performance

0 of 100

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 latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Yancoal Australia

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Yancoal Australia are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable essential indicators, Yancoal Australia is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Dicker Data and Yancoal Australia

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

The idea behind Dicker Data and Yancoal Australia 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.