Correlation Between DIH Holding and Tesla

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

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

Diversification Opportunities for DIH Holding and Tesla

0.73

Correlation Coefficient

DIH Holding  Tesla

Poor diversification

The 3 months correlation between DIH and Tesla is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding DIH Holding US, and Tesla Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tesla Inc and DIH Holding 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 DIH Holding US, are associated (or correlated) with Tesla. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tesla Inc has no effect on the direction of DIH Holding i.e., DIH Holding and Tesla go up and down completely randomly.

Pair Corralation between DIH Holding and Tesla

Assuming the 90 days horizon DIH Holding US, is expected to generate 4.23 times more return on investment than Tesla. However, DIH Holding is 4.23 times more volatile than Tesla Inc. It trades about -0.01 of its potential returns per unit of risk. Tesla Inc is currently generating about -0.23 per unit of risk. If you would invest  5.26  in DIH Holding US, on December 17, 2024 and sell it today you would lose (3.36) from holding DIH Holding US, or give up 63.88% of portfolio value over 90 days.

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

DIH Holding US,  vs.  Tesla Inc

DIH Holding US,

Risk-Adjusted Performance

Very Weak

Over the last 90 days DIH Holding US, has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's forward indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Tesla Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Tesla Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite abnormal performance in the last few months, the Stock's essential indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with DIH Holding and Tesla

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

The idea behind DIH Holding US, and Tesla Inc 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.