Correlation Between Distoken Acquisition and James River

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

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

Diversification Opportunities for Distoken Acquisition and James River

-0.9

Correlation Coefficient

Distoken Acquisition  James River

Pay attention - limited upside

The 3 months correlation between Distoken and James is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Distoken Acquisition and James River Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on James River Group and Distoken Acquisition 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 Distoken Acquisition are associated (or correlated) with James River. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of James River Group has no effect on the direction of Distoken Acquisition i.e., Distoken Acquisition and James River go up and down completely randomly.

Pair Corralation between Distoken Acquisition and James River

Given the investment horizon of 90 days Distoken Acquisition is expected to generate 13.67 times more return on investment than James River. However, Distoken Acquisition is 13.67 times more volatile than James River Group. It trades about 0.05 of its potential returns per unit of risk. James River Group is currently generating about -0.07 per unit of risk. If you would invest  0.00  in Distoken Acquisition on October 23, 2024 and sell it today you would earn a total of  1,113  from holding Distoken Acquisition or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	92.11%
Values	Daily Returns

Distoken Acquisition  vs.  James River Group

Distoken Acquisition

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Distoken Acquisition are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Distoken Acquisition is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

James River Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days James River Group has generated negative risk-adjusted returns adding no value to investors with long positions. Even with fragile performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in February 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Distoken Acquisition and James River

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

The idea behind Distoken Acquisition and James River Group 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 Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.